31 Jul Making tax digital for VAT: An update
In our March 2019 article on Making Tax Digital (MTD) for VAT we posed the question ‘are you ready.’ Since then five months have passed and the clock has ticked inexorably onwards to the time at which the first quarterly MTD submission is due.
Put simply, for those businesses which fall under the MTD remit and whose VAT quarters start in April then, unless they qualify for deferred implementation, the first digital submission for the VAT period April to June is due by the 7th August. Those businesses which make monthly returns will already have made their first digital return whilst those whose quarters start in May or June will have longer to prepare.
So how is MTD implementation going? Well, on 11 July HMRC put out a press release which revealed that at that time out of the 1.2million businesses which fall under the new scheme more than 600,000 businesses had registered. In addition some ten thousand new registrations were being received every day. HMRC acknowledge however that that still leaves some way to go before all eligible businesses have signed up to the new service; with a review of progress to date due to be undertaken once the August deadline has passed. As for that deadline, those paying by direct debit should have registered by 27 July with those paying by other means expected to register by the 4th August.
Those businesses which have failed to register in time should expect to receive reminder letters or e-mails from HMRC. As long as businesses are doing their best to comply with the new regulations HMRC have said that they will not issue filing or record keeping penalties. However they will still sanction businesses for deliberate non-compliance and it is therefore in the best interest of businesses to sign up as swiftly as possible and to ensure records are being maintained in accordance with the new regulations. HMRC have also pointed out that businesses which are subject to deferred implementation can start to sign up now as can businesses with September and October filing dates.
Elemental can act as a ‘one stop shop’ for your UK tax and accounting compliance needs including VAT registration, compliance and submission. Contact us to discuss how we can help you with your Making Tax Digital preparations.