Small Businesses – MTD
Small businesses who are voluntarily VAT registered, because their turnover has not exceeded £85,000, must now be registered for MTD for VAT and complete their next VAT return using MTD compatible software.
Only around 40% of VAT-registered businesses that are trading below the VAT registration threshold had signed up to MTD VAT by 16 May 2022. If your business is one of the remaining 60% that have NOT signed up for MTD for VAT. You should sign up as soon as possible.
When is best to sign up?
If you’ve not already signed up for MTD for VAT, but need to – you may be asking the question of, when is the best time to sign up?
If your business has quarters to end: June, September, December, March, you will be coming to the end of your first VAT quarter in the new regime.
Granted that your business has these quarters, you need to submit the first MTD VAT return by the 7th of August 2022, which means you should sign up for Making Tax Digital by 31st of July 2022.
So, you must sign up and find Making Tax Digital compatible software as soon as possible.
If you haven’t already signed up to MTD for VAT, and don’t have MTD compatible software, you need to do so as soon as possible.
Finding software which is MTD compliant can seem like a daunting task. Not to worry, we have all the information you need in order to choose the correct software for you.
Cloud software is the only viable option for most businesses. You can no longer just sign into your gateway account and input your VAT return. If you choose to keep digital records on a spreadsheet, then you must use bridging software as well as MTD compliant software. For example, using Xero, to make sure you are Making Tax Digital compliant.
Spectrum Accountancy Solutions are certified Xero partners. Xero has made sure that its software is 100% compatible with these new Making Tax Digital rules for HMRC. All of their VAT supporting software cover MTD at no extra cost.
MTD compatible software makes submitting VAT returns much easier. Say goodbye to complicated calculations and manual entry. Using MTD compatible software can save you time by making VAT returns easier.
The government have a full list of compatible software to help you choose the right one for your business. www.gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-vat
At Spectrum, as well as using Xero, we also work with Quickbooks, Sage, Freeagent etc.
Ensuring Your Compliance
Spectrum can help you make the transition to Making Tax Digital compliant software and suggest the best software for your business. Our affordable cloud based bookkeeping solutions are here to suit your individual business needs.
We are here to help you every step of the way of this transition, just give us a call on 0117 9902218 or send us an email at email@example.com to discuss how we can help you make the move to be MTD compliant.
Did you miss our previous blog about Inheritance Tax?Making Tax Digital, MTD, Small Business
This post was written by Daisy Vowles