Helping you prosper

March 2018 – what’s the latest on MTD?

1 March 2018

It has been a while since we last blogged on the Making Tax Digital programme being rolled out by the government. In part that’s been because the roll out has been a little slower and quieter in the last four months. However the regime has been quietly ticking along in the background and we’re nearing the point where it will be possible to get some real life experience of MTD.

Where are we currently?

By way of reminder:

  • MTD is intended to fundamentally change the way taxpayers and HMRC operate. It will oblige the maintaining of business records in approved electronic forms and the submission of data to HMRC from that software via HMRC’s APIs (application programming interfaces – effectively doors to the HMRC system through which data can be pushed by third party software).
  • Planned implementation for various Income Tax payers from April 2018 was deferred by at least two years at the eleventh hour.
  • MTD currently requires any business which is both VAT registered and has turnover in excess of the registration threshold (currently £85,000) to be compliant for all VAT periods starting on or after 1 April 2019.
  • There will be no free of charge HMRC software solution, and taxpayers will be responsible for sourcing and operating ‘Functional Compatible Software’ to meet their obligations.

Pilot for MTD for VAT

In April 2018 the live testing of MTD compliant software for VAT purposes will begin through a voluntary pilot scheme to be opened out to a selection of taxpayers and agents.

Here at UHY Hacker Young we were amongst the first in the country registered for last year’s Income Tax pilot. We’ve registered our interest with HMRC for the VAT pilot and will be working closely with our preferred software provider Xero in terms of participating in the upcoming VAT pilot.

If you have a VAT registered business and are interested in taking part then we’d love to hear from you.

Alternatively if you’re starting to wonder what you should be doing now to prepare yourself for next April we’re continuing to offer system and process reviews for businesses and to help clients with the switch to cloud accounting.

For more information, please contact me or your nearest cloud accounting specialist. To read more of our blogs about Making Tax Digital, click here.