Making Tax Digital for VAT Notice Released by HMRC
On 13 July 2018 HMRC released VAT Notice 700/22: Making Tax Digital for VAT. As the scheme is only months away from its scheduled launch date, businesses and accounting firms alike will likely welcome the additional clarification that this release brings.
What is Making Tax Digital for VAT?
Making Tax Digital for VAT will come into effect from 1 April 2019. From this date, businesses above the VAT-registration threshold, which is currently £85,000, will be required to keep digital VAT records and file electronic VAT returns with HMRC.
Although the scheme was announced back in 2015, more information is becoming available as we edge closer to the scheme’s rollout date.
A number of Making Tax Digital for VAT materials have been published
On the same day that the Making Tax Digital for VAT Notice was published, HMRC also released a number of other documents relating to the scheme, including a stakeholder communications pack and a list of software providers that are supporting the scheme.
When it comes to content, the VAT Notice offers further information and explanation in relation to the requirements under the Value Added Tax (Amendment) Regulations 2018, which were made in February 2018. It contains information that should help businesses determine whether they are within the scope of Making Tax Digital for VAT, while also providing other explanatory notes in relation to items such as digital recordkeeping requirements.
You can read the VAT Notice in full here.
The stakeholder communications pack, on the other hand, provides stakeholders with information to help them prepare for the upcoming changes brought by Making Tax Digital and communicate these changes with affected clients, customers, or members. It also contains information about the Making Tax Digital for Income Tax pilot.
Finally, the list of software suppliers provided by HMRC outlines the suppliers that are working with HMRC during the Making Tax Digital for VAT pilot. The list, which includes DataTracks, includes software suppliers who have tested their offerings within HMRC’s test environment and have demonstrated a prototype to HMRC.
There’s still time to get prepared
Despite concerns that the starting date for Making Tax Digital for VAT could be postponed due to the pressures of Brexit (which is expected to occur at the same time) it seems as though there’s no change in sight to the planned April 2019 rollout.
As a result, businesses that haven’t yet prepared for Making Tax Digital for VAT should start thinking about whether they could be impacted by the changes, and how to prepare their record keeping and reporting systems if they are.
DataTracks has been recognised as a software provider for Making Tax Digital for VAT by HMRC. With over a decade of experience helping clients with their XBRL and iXBRL filing needs, DataTracks is well placed to ensure that clients can transition to the new Making Tax Digital for VAT online filing requirements without fuss. For more information on our Making Tax Digital services, contact a member of the team today.