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Making Tax Digital

12/03/2019 13:29:02
I use accounting software which isn't MTD digital compatible (no api) . What format does the data need to be exported out so that bridging software can be used to submit digitally from April. ?
Currently I export the vat return report in pdf format as I need to then manually add import vat paid from C79 certificate and fuel scale charges. How can I do this for the April return as this is not received digitally ? I haven't yet decided on which bridging software.
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Making Tax Digital

12/03/2019 17:03:20
Hi Vkeillor,

Most of the bridging software I've seen accepts only CSV format.

With regards to your query on adding in the import VAT and fuel scale charges, will your software let you record General Ledger Journals for these?

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Making Tax Digital

13/03/2019 11:12:23
Hi the fuel scale charges are entered as journals but the vat return does not automatically pick it up, the C79 figure is entered as a payment when the money is taken direct from the bank account. So I guess I need the software to include these totals when producing the vat return. The other issue I have is box 6 . Sometimes all items included on C79 I haven't yet received a supplier invoice so I need to manually reconcile what has gone through as purchases and what is outstanding - this figure is currently then added to purchases figure to ensure no error is reported on submission. Can you advise how I will manage this or do I have to accept the error being reported?
I note the csv format.
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Re:Making Tax Digital

13/03/2019 12:40:43
Hi,

This is a response for the question from VKEILLOR on 12/03/2019 at 13:29.

Please refer to the following links to the current guidance in relation to digital links, bridging software and compatibility:

VAT Notice 700/22: Making Tax Digital for VAT

Making Tax Digital: how VAT businesses and other VAT entities can get ready

This is the only advice we can offer at present, but discussions with your chosen software provider may be appropriate.

I hope this helps.
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Making Tax Digital

13/03/2019 12:53:25
Our bookkeeper uses spreadsheets and supplier statements to calculate payments to be made, then when the payment comes through on XERO she posts a reconciling entry to the correct nominal code entering the correct net/gross figures. She doesn't attach the statement or spreadsheet that supports the payment. With MTD does she now have to enter all the invoices individually, or perhaps she could enter the statement totals against the supplier/continue as before but attach the spreadsheet/statement. The former is great for transparency but will be alot of extra work, but I'm not sure how far "keeping digital records" goes??
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Re:Making Tax Digital

14/03/2019 08:08:12
In answer to the above question posted 13/03/19 at 12:53:25.

Hi,

Thanks for your question.

Section 4.3.3 of VAT notice 700/22 lists what records must be kept digitally. It says for each supply you receive you must record the following digitally:

• Time of supply

• Value of supply

• Amount of input tax that you will claim.

The section goes into further detail about what needs to be kept this way and what doesn’t.

VAT notice 700/22: Making Tax Digital for VAT

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Making Tax Digital

15/03/2019 10:10:26
Hi Vkeillor,

RE: Fuel Scale Journal – in the first instance I would contact your software provider to see if there is a setting that can be changed for these Journals to get picked up for your VAT return automatically. Some software allows different types of Journal, and not all will appear on a return.
If there is no way of these being changed then maybe an alternative would be start recording the scale charge as a customer invoice instead, so you would raise an invoice in the software for the amount of the fuel scale due to a “Fuel Scale Charge” customer account, which would get picked up on your return as a Box 1 / Box 6 entry.
RE: C79 – forgive me as I don’t come across import VAT very often, but I thought that import VAT was claimed as per the invoices from the freight company, and the C79 was just kept as evidence, rather than being claimed solely on the C79 itself? Either way, as long as the difference on your VAT return is just a timing issue then this seems a reasonable explanation to me, should HMRC query it. For MTD you won't be able to add in these adjustments manually, so unless there is some other way to get them into the software (either by a Journal or importing somewhow) I think you will need to stop doing them.
------------------------------------------
Hi Anon - with regards to your question about whether entries on supplier statements will now need to be recorded individually rather than as a total - I have written to HMRC about this myself, as I'm also a bookkeeper, and unfortunately got the same vague response from them. From pieces of information I've managed to get elsewhere it does seem like we will have to record each invoice individually now. I think when HMRC say that the digital records must be “transactional level detail” this means each invoice must be recorded rather than a statement total being treated as one entry.
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Making Tax Digital

15/03/2019 12:05:47
My company is part of a VAT group so I believe this means we qualify for deferral of MTD until 1 October 2019. I understand we should receive a letter from HMRC confirming this deferral but if we don't receive this letter by 1 April 2019 then by default we will be required to comply with the MTD regulations from 1 April 2019. So far we have not received this letter so is there somewhere in HMRC I can contact to confirm this letter will be issued or if is has been issued obtain a copy of it.
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Re:Making Tax Digital

15/03/2019 12:49:13
This is response to a question posted by Barry James

Yes VAT groups are deferred until Oct 2019, if you believe you should have had a letter and haven’t received one then please call the advice line so they can check this for you.
Telephone no: 0300 200 3700
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Making Tax Digital

18/03/2019 09:25:29
Thank you for your response.

I had already tried that telephone number. To be honest I was getting nowhere. I was directed to gov.uk but that does not have a facility for specific questions like mine. It really only deals with general issues about MTD. Is there not a chat line for MTD queries where I can outline my specific issue.
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Re:Making Tax Digital

18/03/2019 13:18:46
Hi

Apologies if you had an issue getting through on our phone lines but that is the number you must call in order to speak to an adviser, if the agent cannot assist you, they can transfer you to our dedicated Making Tax Digital team, or arrange a call back should they not be available.

Just to clarify, if you are a VAT group, you are deferred from MTD until October 2019, regardless of whether you have received this letter or not. HMRC expect businesses to be fully responsible for complying with the MTD rules and should be monitoring the guidance available online themselves in order to ensure they are ready from the relevant date. The letters will only be sent to businesses that are flagged as being over the threshold, but should you wish to check whether or not a letter has been sent to your business already, you will need to call the number stated above.
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Re:Making Tax Digital

26/03/2019 08:17:05
This is in response to the question posted by Anonymous 13/03/2019 11:12:23

Hi,

Thanks for your question.

Unfortunately HMRC cannot advise on this as it will depend on what software you use and how it works.

You will need to contact your software supplier regarding this particular transaction type to find out how it can be incorporated.
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Making Tax Digital

27/03/2019 08:27:32
I am still thoroughly confused by what exactly constitutes a "digital link".

Our version of our accounting software is not MTD compliant, and as a small charity we are not prepared to pay the extortionate annual subscription that our software is demanding merely for the privilege of filing VAT returns 4 times a year.

We are therefore looking at using an excel bridging software solution.

All the VAT guidance says that a "digital link" must exist between the bridging software and the accounting package.

But what exactly does this mean???

I am assuming that most bridging solutions use an export from the accounting package into the excel file. But how does this demonstrate a digital link? Surely once the data is downloaded, there is no digital link back to the accounting software - it's just a load of data that's been downloaded?

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Making Tax Digital

27/03/2019 10:49:56
Is it just me but I have spent the last 2 days trying to sign up for MTD and just get the message 'Sorry, we are experiencing technical difficulties'?
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Re:Making Tax Digital

27/03/2019 11:30:10
We will have the software in place for MTD and the link to HMRC but that will not be until next week, April 1st 2019.

However, we signed up online for the service and have still to make our February submission which will not be in the digital format.
As we have signed up for MTD we cannot make our February submission in the old online way.

Any suggestions ?

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