What is Making Tax Digital (MTD)?
Making Tax Digital is a HMRC program with an aim is to digitise the taxation system. From April 2019, the Government Gateway will be closed and access for submission of VAT returns will only be possible using MTD-compliant software.
However, there is also a requirement for 1 years’ worth of data to be included on compliant software, before the 1st VAT return under the new system. This means that this change will be required from the start of your next financial year, i.e. 1st July 2018 for anyone with a June Year-End.
The first VAT return under the new regulations will be for the quarter ending June 2019.
What do I need to do next?
1) Align VAT quarter
We would highly recommend that now is also the time to realign your VAT quarter with your Year End to ensure a smooth transition to MTD.
2) Review accounting software
There are several systems that are compliant, and Oldfield can offer assistance with upgrading or transferring to either Sage 50 (Desktop) or Xero (Cloud).
Older versions of Sage will no longer be compatible with HMRC's requirements for digital submissions; hence all users must upgrade to Sage's monthly subscription package, or to the most recent version (under an annnual licence) and purchase an additional MTD compliant module, or consider an alternative compliant solution.
Benefits of cloud software
Achieve significant data entry efficiencies
Achieve faster reporting for better business management
Enhancing capacity for real-time analysis
Secure access to the software from anywhere at any time
Although there are several systems available, we are recommending Xero as a cloud based alternative, that we can support and assist with implementation.
Xero integrates with 500+ cloud apps, effectively allowing you to build your own custom ERP system. Being located on the Cloud allows unlimited users to access the system anywhere at any time. There are many efficiency gains, particularly around bank entries, which allows faster reporting and real-time analysis. Not only this, it also has a low monthly subscription of just £22 / per month (including all upgrades FOC and unlimited users)
For further information on the impact of MTD, or for assistance with any of the above, including a free assessment of your software, please contact email@example.com