What is MTD?
MTD, Making tax digital, is the governments plan to digitalise the UK tax system. A more efficient digital tax return system is expected to reduce errors and increase efficiently and general Uk productivity.
What’s already happened?
Phase one: In April 2019 all businesses that are VAT registered and with a turnover of £85k in a twelve month period had to start submitting their tax returns via MTD compliant accounting software rather than using the HMRC Gateway.
What’s happening next?
Announced on the 21st July 2020 by HMRC we had confirmation of the next two phases in the MTD Plan.
Phase two: In April 2022 all VAT registered businesses will need to use MTD compliant accounting software to file their VAT returns instead of the HMRC website. 30% of VAT businesses that don’t have to currently follow MTD rules already do so this is a great start.
Phase three: From April 2023 anyone that files a self assessment tax return with more than £10,000 turnover from either business or property or a combination of both will have to file their returns utilising MTD compliant software.
What do I need to do?
If you are a VAT registered business and want to be MTD compliant ready for the April 2022 date then OnPoint Accounting can help you setup and utilise MTD compliant accounting software such as Quickbooks. Once set up we can help you link the software to HMRC and convert your VAT registration to MTD.
If you want to get MTD ready for Self Assessments OnPoint Accounting can also help you setup and utilise accounting software and tax filing software to make you MTD ready.
We strongly advise you get MTD ready early, this gives you time to test and learn new processes and systems and prevents you being part of the mad rush at the deadline date.
Contact us via our contact page to get help becoming MTD Compliant