Making Tax Digital (MTD) is driven by HMRC’s ambition to become one of the most digitally advanced tax administrations in the world and MTD is making fundamental changes to the way the tax system works.
HMRC is transforming the tax administration so that it is more effective, more efficient and easier for taxpayers.
The first stage of HMRC’s Making Tax Digital (MTD) programme focuses on VAT, also known as Making Tax Digital for VAT (MTDfVAT).
From April 2019, HMRC is imposing new requirements on many VAT registered businesses who will need to
Maintain their accounting records digitally in a software product or spreadsheet.
Submit their VAT returns to HMRC using a MTD for VAT compatible software.
HMRC have published a VAT Notice about MTD which businesses may find useful.
When is Making Tax Digital happening?
From 1 April 2019, all VAT-registered businesses with a taxable turnover above the VAT threshold (£85,000) are required to keep their VAT business records digitally and send their VAT returns using MTD-compatible software.
From April 2019, software that prepares a VAT return to send to HMRC must be MTD-compatible. This means that it can integrate with HMRC systems to send VAT returns to HMRC, via the application programmers interface (API) .
From April 2020, data must be exchanged digitally between all software used by a business for VAT. The information contained within the MTD VAT return will be generated by pulling information from the digital records. This information will be the 9 boxes required for the VAT return.
For further information, visit the HMRC site.
Easier for businesses
What are the benefits of Making Tax Digital?
Increasingly, businesses are reaping the benefits of digitisation. Millions of businesses are already banking, paying bills and interacting with their customers or suppliers online, and many are already using accounting software.
The move to digital integration will eliminate many of the existing paper-based processes, allowing businesses to devote more time and attention to maximising business opportunities, encouraging growth and fostering good financial planning.
By making it easier to get things right, digital record keeping will reduce the risk of unwelcome and costly HMRC compliance interventions and help businesses to manage their cash flow more effectively.
Making Tax Digital with Zumzum Financials
Zumzum Financials is accounting software, built 100% native on the Salesforce platform, designed for businesses of all sizes, to help you on your going digital journey.
Zumzum Financials is a HMRC recognised, MTD for VAT compliant solution which automatically calculates your VAT return (9 boxes) and the makes it easy for you to submit your VAT return directly to HMRC.
You can find Zumzum listed on the gov.uk site for software which is compatible with Making Tax Digital for VAT.
Find out how we can help your business with your Making Tax Digital for VAT journey.
Store your digital records, automatically calculate the tax you owe and submit your returns online, 100% native on the Salesforce platform.
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