Unprepared firms urged to consider their accounting software options as MTD looms
Many firms remain unprepared for the launch of Making Tax Digital for VAT (MTD) in April, and we would urge those that have yet to update their systems to be careful of overspending on expensive new systems which may not offer the best solution.
Tony Hyde, Senior IT Manager at Newby Castleman
MTD applies from April 1st 2019, and many businesses still have not received official notification from HMRC that they are affected. Under MTD, all businesses with a taxable turnover above the VAT threshold must keep digital records and send VAT returns digitally to HMRC using MTD compliant software.
Our Senior IT Manager Tony Hyde said, “While most bigger businesses will be prepared for the changes MTD brings, many small and medium size enterprises (SMEs) still may not be – indeed, HMRC admitted recently that it is still in the process of sending letters to all businesses affected by MTD, with less than 11 weeks before it begins.
“There will be a lot of smaller businesses caught by MTD, which do their accounting using spreadsheets or accounting software that is not MTD-compliant. They will review their systems very soon to ensure they will be able to submit their VAT Returns commencing on or after 1st April via MTD compliant software as this will not be possible via the existing HMRC portal.”
Tony continued “For some businesses, the cost implications of being MTD compliant may be excessive; we're finding that many clients are turning to “bridging software” as a more cost-effective solution. Bridging software enables businesses more comfortable using spreadsheets or those that wish to continue using their existing non MTD compliant software to meet the filing requirements of MTD. We will have such a solution available for clients; anyone interested should get in touch for more details.”
“Different software options will suit different companies, but ready or not, MTD is coming in April, and those firms uncertain about their preparedness for it should contact us to discuss their options.”
Find out more about Making Tax Digital here.