{"id":21947,"date":"2022-04-13T11:34:11","date_gmt":"2022-04-13T11:34:11","guid":{"rendered":"https:\/\/smh.group\/?p=21947"},"modified":"2024-03-05T16:05:37","modified_gmt":"2024-03-05T16:05:37","slug":"the-next-step-for-making-tax-digital","status":"publish","type":"post","link":"https:\/\/devstagesite.co.uk\/smhgroup\/the-next-step-for-making-tax-digital\/","title":{"rendered":"The next step for Making Tax Digital"},"content":{"rendered":"

From 1 April 2022, all VAT-registered businesses must implement Maxing Tax Digital (MTD)<\/a> regardless of turnover.<\/strong><\/p>\n

MTD for VAT has been in place for three years, but this first phase excluded voluntarily registered businesses beneath the registration threshold.\u00a0<\/strong><\/p>\n

The vast majority of businesses registered voluntarily under the scheme will have done so because they can recover input VAT without suffering any, or much, in the way of output VAT \u00a0\u00a0\u2013 typically where customers are VAT registered or sales are zero-rated. Most new entrants will therefore not be using the flat rate scheme and will have to keep full digital records.<\/p>\n

There are limited exceptions from MTD, but voluntarily registered businesses can simply deregister if the amount of VAT recovered doesn\u2019t warrant the time and\/or cost involved with MTD compliance.<\/p>\n

Signing up<\/strong><\/p>\n

Those businesses now coming into the scope of MTD must use it for their first VAT return starting on or after 1 April 2022. There could therefore be quite a delay if submitting returns annually. For example, with an annual accounting period to 31 December, MTD will not need to be used until the year beginning 1 January 2023.<\/p>\n

Businesses need to sign up for MTD, but this should be done only after the final non-MTD return has been submitted. If paying by direct debit, sign up needs to be at least a week before the first MTD return is due.<\/p>\n

Software<\/strong><\/p>\n

Compatible software has to be in place for the start of the first MTD VAT return period. The easiest option will be if records are currently kept on a spreadsheet. Free bridging software can then be used to pick up relevant details and submit VAT returns to HMRC. Bridging software is necessary because any transfer of data must be done using a digital link; cutting and pasting is not a digital link.<\/p>\n

Even if full VAT record-keeping software is required, there are some free versions available.<\/p>\n

Smaller businesses will invariably be wary of change, but MTD should improve accuracy. HMRC figures show that for 2019\/20, a reduction in errors brought in some \u00a3195 million in extra VAT revenue.<\/p>\n

Details of MTD<\/a> software that has been through HMRC\u2019s recognition process can be found here,<\/a> or you can get in touch with one of our Sheffield Accountants<\/a> for a no-obligation meeting to discuss your options.<\/p>\n","protected":false},"excerpt":{"rendered":"

From 1 April 2022, all VAT-registered businesses must implement Maxing Tax Digital (MTD) regardless of turnover.<\/p>\n

MTD for VAT has been in place for three years, but this first phase excluded voluntarily registered businesses beneath the registration threshold.\u00a0<\/p>\n","protected":false},"author":4,"featured_media":21948,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[3],"tags":[106,104,187,76,261],"class_list":["post-21947","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-smh-accounting-business-advisory","tag-making-tax-digital","tag-mtd","tag-self-employed","tag-vat","tag-vat-returns"],"acf":[],"yoast_head":"\nThe next step for Making Tax Digital - SMH Group<\/title>\n<meta name=\"description\" content=\"From 1 April 2022, all VAT-registered businesses must implement Maxing Tax Digital (MTD) regardless of turnover.\" \/>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The next step for Making Tax Digital - 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