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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

15/02/2019 11:57:26
Hi,

This is in response to the question posted by Anonymous dated 13/02/19 11:28:15

Thanks for your question.

We have a step by step guide for Agents in regard to Making Tax Digital and signing clients up, please see the link below:

Making Tax Digital for VAT as an agent: step by step

If you already have a client on your existing Agents account, they will not need a Business Tax Account for you to map them over to your MTD Agents Services Account (ASA).

If this is a new client that is not currently on your existing Agents account, then they will need a Business Tax Account before they can be added to your MTD Agents Services Account.

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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

15/02/2019 12:37:42
Question originally posted by Guy on 14/02/2019

Could you please advise on TOMS Scheme - if there is no software compatible for TOMS Vat return - how do you submit VAT declaration on HMRC Portal
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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

15/02/2019 12:40:54
Hi Guy,

Thanks for your question.

Information on how Making Tax Digital affects Margin Scheme traders can be found in Section 3.8 of the link below.

This should be read and guidance followed in conjunction with the full Notice.

VAT Notice 700/22 - section 3

Find software suppliers for senjding VAT returns and Income Tax updates - Software for VAT available now

Please can you also check your private messages.
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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

15/02/2019 15:42:16
Hi,

This is just to advise that we are liaising with our technical advisers and any unanswered questions will be answered as soon as possible.
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Making Tax Digital for VAT - Use software to submit your VAT Returns

18/02/2019 12:40:19
Dear HMRC

A few weeks ago, I telephoned the HMRC VAT helpline and was informed that MTD could be deferred until October 2019 as ours is a 'complex business'. I was asked a series of questions which included: 'are you part of a VAT group?' NO. 'are you a public sector body?' NO. 'do you use annual accounting?' NO. then finally, 'Do you trade with the EU?' YES - we sell to EU customers, and buy from EU suppliers. At this point, the HMRC advisor said we could defer MTD until October 2019.

Having looked at the categories for deferral in notice 700/22, I can't see where deferral is available to companies which merely trade with the EU - it appears to be only those companies which are actually based overseas. We're not - we're based in the UK but buy and sell internationally. Could you please confirm categorically if we are able to defer until October, or if we need to use MTD from our April to June quarter (filing in July)?

I sense there is some miscommunication at the HMRC helpline. The first advisor I spoke to said I would need to use MTD to file our January to March quarter (doing the filing in April). I wasn't happy with the advice as he put me on hold for a long time and seemed unsure with his answer, so I asked to be transferred to another advisor. The second HMRC advisor then contradicted the first one and told me it was for the April to June quarter (filing in July). But he added that, because we traded with the EU, we could defer until October. (As per the conversation I've summarised in my first paragraph.)

Could you give me a definitive answer as to whether trading with the EU (as opposed to being based overseas) is a category for deferral until October?

Mrs Partridge
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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

18/02/2019 13:12:55
Hi Mrs Partridge,

Thanks for your question.

Please see this extract from our guidance on Making tax Digital for VAT. From the information you have provided, we do not see you falling into any deferred category.

“For a small minority of businesses that have more complex requirements, we have made the decision to defer mandation by 6 months to ensure there is sufficient time for testing the service with them in the pilot before they are mandated to join.

These businesses have until 1 October 2019 to start keeping records digitally and using MTD-compatible software to send their VAT returns to HMRC.

This applies to those that fall into one of the following categories:

• trusts, ‘not for profit’ organisations that are not set up as a company,
• VAT divisions,
• VAT groups,
• those public sector entities required to provide additional information on their VAT return (such as government departments and NHS Trusts),
• local authorities,
• public corporations,
• traders based overseas,
• those required to make payments on account and
• annual accounting scheme users.”

Please see the links below for further guidance:

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

VAT notice 700/22: Making Tax Digital for VAT


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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

19/02/2019 09:32:26
Hi

Each quarter we need to make a manual adjustment to our VAT return. We are an investment management business and the vast majority of our fee invoices are VAT exempt. Therefore we currently make a manual adjustment to the quarterly VAT return to reduce the amount of input VAT reclaimable based on the proportion of exempt sales to total sales.

Do you know how we would make this manual adjustment when submitting our VAT Return using the MTD system please?

Our current software doesn't seem to be offering MTD updates to their software so we are trying to decide whether to change our software or extract the VAT return information from our current software into an Excel spreadsheet and make the manual adjustment in there and then submit through an API?

Many thanks
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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

19/02/2019 09:40:36
Hi,

In response to the previous question dated 19/02/19 09:32:26.

Thanks for your question.

As a partially exempt trader we appreciate certain adjustments need to be made when submitting your VAT Return to correct the Input Tax recoverable.

In our VAT Notice on Making Tax Digital 700/22, we give advice on how these adjustments can be carried out to comply. Please pay particular attention to Sections 3.2.1, 3.4 and 7 (Examples 5 & 7).

As VAT is a self-assessing tax, please refer to the following links and follow this guidance:

VAT notice 700/22: Making Tax Digital for VAT

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Find software suppliers for sending VAT Returns and Income Tax updates
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Making Tax Digital for VAT - Use software to submit your VAT Returns

19/02/2019 10:15:23
Can you say which of the software providers systems can cope with either the Margin scheme or the Global accounting scheme please ?. I signed up with QuickBooks, only to find out that in reality they, like the vast majority, do not appear to be able to cope with the sale of second hand goods. This is a real problem for anyone working in that market which appears to be going unnoticed.
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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

19/02/2019 10:46:48
Hi,

This is in response to the previous question dated 19/02/19 10:15:23.

Thanks for your question.

HMRC cannot recommend any particular type of software, so you may have to check directly with the suppliers, but please read our information for Margin Scheme traders in Section 3.8 of VAT Notice 700/22 initially in the link below.

VAT notice 700/22: Making Tax Digital for VAT

Please also refer to these links in regard to Software providers and their compatibility, the last link is a YouTube video.

Find software suppliers for sending VAT Returns and Income Tax updates

Software that works with Making Tax Digital for VAT

Making Tax Digital for VAT - What is compatible software?

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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

20/02/2019 09:52:03
Hi,
Your Making Tax Digital (Difficult) really does not work and is a total nightmare to use. I used to do my VAT return in 10 minutes and I have now spent over two weeks and countless hours trying to submit my January return. I have used an accounting program of your choice, Xero, at considerable expense and infinitely more work for me and your system will not accept it. I have contacted HMRC and Xero, at least Xero had the grace to reply and try to help. The system tells me the GatewayID, Password or VAT number is incorrect which is not, I can still log in to the old HMRC VAT website without a problem. I have now given up as have my accountants, I guess I will just wait until you want your money because I know you will contact me then.

In the meantime for MTD and go back to the way that has worked for the last 25 years or more.


****************************************************************
Response from HMRC 06/06/2019

This page has been updated in response to feedback.

This message was edited 1 time. Last update was at 06/06/2019 07:50:58

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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

20/02/2019 09:52:03
Hi - your timeline is incorrect/unclear.. April 2019 is only for those who are a) over the threshold & b) not deferred, per the definition of deferred below. This is therefore confusing - small business registered for VAT but turnover below the 85k threshold DOES NOT need to register for MTDV by April 2019. Please update your timeline. https://www.gov.uk/government/publications/making-tax-digital/overview-of-making-tax-digital
April 2019 Making Tax Digital mandated for all customers (except those that have been deferred).[AND THOSE BELOW THE 85K THRESHOLD]
October 2019 Making Tax Digital mandated for customers that have been deferred. The 6-month deferral applies to customers who fall into one of the following categories: trusts, ‘not for profit’ organisations that are not set up as a company, VAT divisions, VAT groups, those public sector entities required to provide additional information on their VAT return (Government departments, NHS Trusts), local authorities, public corporations, traders based overseas, those required to make payments on account and annual accounting scheme users.
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Re:Making Tax Digital for VAT - Use software to submit your VAT Returns

20/02/2019 09:54:06
Thanks for your feedback, we have passed this on to the relevant team.
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Making Tax Digital for VAT - Use software to submit your VAT Returns

01/03/2019 12:20:40
Hello

I wonder if anyone has had any issues when registering clients for MTD via the agent portal?
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Making Tax Digital for VAT - Use software to submit your VAT Returns

01/03/2019 12:22:04
We use a spread sheet system and quite happily submit our returns the way they are. It is a simple and quick process. I am 70 years old and this is my last year of working physically and although our small business will continue, it will mean that our turnover will now drop to around £75K. I do not want to de-register, neither do I want to learn or go to the expense of buying new software. Advice please.
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Making Tax Digital for VAT - Use software to submit your VAT Returns

01/03/2019 13:45:31
My company is just me. I simply charge clients for my time and manually issue just 2-3 invoices a month. I don't use excel or any other software and just type out my invoices in Word. I then do my Vat return online.
What software am I going to be forced to use for a task which doesn't need software?