We have now had at least one full quarter end for everyone who needs to be included in Making Tax Digital (MTD).
Have you successfully managed this change to submit through cloud software?
If not, don’t worry too much as HMRC are still in the “soft landing” phase and not penalising anyone – YET.
If you have had letters from HMRC suggesting you should have submitted this way, rather than via the old gateway, please check with your accountant. If you haven’t yet got any cloud accounting package, don’t panic! It is easy to switch but the best time is from the start of a VAT quarter. The majority of packages are set up for filing VAT via MTD.
HMRC have a soft landing period up to 1 April 2020 where full digital links do not have to be in place. After that, businesses will have to apply to HMRC for an extension if they cannot link their figures directly to submit their VAT returns. The application will have to have specific detail as to why the software is not compatible and how long it will take to become compliant. Please do talk to your local UHY cloud accounting advisor if you feel you need help.
Any clients who are struggling with cloud software are still able to use spreadsheets to create a digital link for submissions with the use of bridging software, but the underlying records must be digital and not paper.
Change does not have to be scary
Taking photos of invoices and receipts using an app such as Receipt Bank is a great way of not needing to keep boxes and boxes of paper, and HMRC are accepting sight of a scanned invoice these days. Cloud software also has the advantage of your accountant being able to see your transactions straight away rather than having to wait for a backup or spreadsheet to arrive.
There are plenty of digital options out there (i.e. Receipt Bank and Xero) and UHY may be able to save you some money on the advertised prices. Please do get in touch.