The MTD start date for most VAT registered businesses is the beginning of their first VAT period which starts on or after 1 April 2019. This doesn’t mean that the business has to be signed up to submit VAT returns using MTD-compatible software from the start of that period, only that it must be ready to submit using MTD software when the VAT return for that period is due.
In practice this means signing-up for MTD at least 72 hours before the VAT is payable to ensure the confirmation email has time to arrive from HMRC. Where the business pays its VAT by direct debit it must currently give HMRC 15 working days notice on top of this 72 hour buffer, as we explained in our newsletter on 28 February 2019.
The 15-day notice period needed to set up a new direct debit mandate is caused by HMRC using a different bank account to receive VAT paid under MTD, and is a result of banking regulations. However, HMRC realises this long delay is detrimental to the smooth running of MTD, so it is shortening the period for DD switching.
This change requires some reprogramming, so the MTD for VAT service will be shut for maintenance from 5pm on 15 March and 8.30am on 19 March. During that period businesses won’t be able to submit VAT returns under MTD or sign-up to MTD. However, they will be able to make VAT payments to HMRC.
This shut-down won’t affect your Agent Services Account (ASA). You can continue to operate your ASA and map your clients over. Remember you will not see a list of clients mapped over to your ASA from within your ASA. This client list will only be accessed from within your MTD enabled software – although most bridging software will not have that functionality.
HMRC has said it is working to provide tax agents with more information about their clients who are signed-up to MTD, and that may involve a client list in the future.