You can’t keep your head in the sand about MTD for VAT any longer: it is happening and we need to prepare you and yourselves. But there are an enormous number of outstanding questions about MTD.
Some of the answers may be found in the HMRC’s VAT Notice: Making Tax Digital for VAT, which is due to be published any day now, – we will let you know when it appears.
Many pertinent questions were raised by listeners to the MTD webinar hosted by CIOT on 7 June 2018. This is webinar freely available to stream from the CIOT website. You don’t have to be a CIOT or ATT member to access the webinar, as it is provided as part of the CIOT’s charitable objective of tax education. The CIOT technical team have found answers to all of those questions, which they have listed in a separate document. Here are some of the highlights:
- The go live date for VAT will be 1 April 2019, it will not be postponed for Brexit.
- The MTD for VAT pilot currently includes invited businesses and agents, but it should be opened up to all businesses by the end of the summer.
- There are over 100 software companies developing MTD for VAT packages, and the approved list of MTD for VAT software will be published by HMRC once the test phase is complete and products go live.
- HMRC anticipate that broadly the same number of taxpayers will be digitally excluded from MTD for VAT as are currently exempt from online filing of VAT returns – ie very small number.
- Business will have to comply with MTD for VAT from the start of the next VAT return period once the VAT threshold of £85,000 of sales in 12 months has been exceeded, there is no look forward test of turnover.
- Businesses won’t be notified individually that they have to comply with MTD for VAT, you will have to tell those of your clients who are affected.
HMRC will run a Talking Points webinar for tax agents on the detail of MTD for VAT on 24 and 25 July 2018, which can be viewed at three alternative time slots. The CIOT will also host another MTD webinar this Autumn, which will be worth watching.
Written by the Tax Advice Network