Get Ready For Making Tax Digital VAT Returns

Why do I need to submit a VAT Return?

 

If your annual turnover is above £85,000 per year, you must register for Value Added Tax (VAT). Once registered you will have a number of obligations to fulfil including adding VAT to customer sales, keeping sufficient records and submitting quarterly or annual tax returns, depending on your chosen scheme. If you sell digital goods or services within the EU, you will also be required to register for the VAT Moss scheme and pay VAT rates based on the country of your consumer.

How can we help?

 

As HMRC Agents for VAT we can assist you with all aspects of your VAT and VAT Moss requirements. We can help with registering, calculating and submitting your VAT returns and keeping adequate records so you are fully prepared in case of a VAT investigation by HMRC. 

 

Making Tax Digital has been launched and is also on it's way for all VAT registered businesses and we can help you prepare for the change which comes into affect for small businesses on 1st April 2021.

Here are the VAT Returns Processes that we can help with:

  • assist with your VAT and/or VAT Moss registration

  • account for VAT on qualifying sales

  • convert non-sterling sales receipts (money in)

  • process purchase claims

  • review VAT records each quarter

  • calculate VAT liability or refunds

  • submit VAT returns to HMRC in line with your scheme requirements

  • generate and submit EC sales list each month

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Making Tax Digital - your questions answered

 

What is Making Tax Digital?

Making Tax Digital (MTD) is an HMRC initiative designed to make sure the UK tax system is effective, efficient and easier for taxpayers. VAT-registered businesses above the threshold of £85k will have to keep digital records and submit their VAT returns using MTD-compatible software. Making Tax Digital for business (MTD) launched on 1 April 2019 with MTD for VAT.

How will MTD impact my business?

Change can often seem daunting, especially if it requires you to adopt new technology. Don’t regard Making Tax Digital as just another obligation. This is your opportunity to streamline your accounting and business management. Keeping records and filing tax digitally gives you the chance to regularly check income, expenses and profit in your business – which will help you to make better decisions.

What will I need to do to stay MTD compliant?

Despite all the recent confusion surrounding MTD, it’s not as scary as it sounds. All you (or your accountant) need to do is record your taxable records and submit your VAT returns through MTD-compatible software – like Xero.

Where can I go for more information?

HMRC has published a VAT Notice – VAT Notice 700/22 Making Tax Digital for VAT – with complete details about MTD for VAT, including several examples and scenarios. We’ve also created useful content to help you throughout the transition.

How do I know if my software will be compliant?

HMRC publishes a list of compliant software products. We’re proud to be on the list. It’s just one part of our commitment to support small businesses and their advisors through the transition and beyond.

What if I’m not using Making Tax Digital for VAT compliant software?

If you’re using software that is not MTD for VAT compliant, you have two options:

  • Move to MTD for VAT-compliant software. This is something we can help you with. Contact us for details.

  • Use a bridging software product to submit your MTD for VAT return for you. Of course, using Xero means enjoying more online accounting benefits sooner – and not just for MTD for VAT.

What digital records do I need to keep?

HMRC has ruled that the following must be kept digitally in order to comply with MTD for VAT:

  • Business name and contact details

  • VAT number and scheme used

  • Adjustments

  • VAT on supplies made and received

  • Time of supply or receipt

  • Net value (excluding VAT)

  • Rate of VAT charged or that you will claim back

  • Daily Gross Takings (DGT) - retail scheme users only

  • Value of sales made

  • Total output tax on purchases