Making Tax Digital for VAT pilot now open to more businesses

posted in Uncategorized

HM Revenue & Customs (HMRC) has announced more businesses can now join its Making Tax Digital for VAT pilot. In October 2018 the pilot opened to half a million UK businesses mandated to store digital records and submit VAT returns digitally. It has now been opened to all businesses mandated from April 2019.

We welcome this announcement as a significant step towards HMRC delivering a modern tax administration. With more businesses now able to join the pilot, they’ll have extra time to find their feet and prepare for the official start date.

What does this mean for me and my clients?

Businesses with a turnover above the VAT registration threshold of £85k will need to keep their business records and submit VAT returns digitally.

If you’re a Xero partner, you and your clients that meet the latest criteria set out by HMRC can join Xero’s MTD for VAT beta programme.

Get ready for MTD now

With the MTD for VAT mandation date just weeks away, we recommend signing up now to Xero’s beta programme. This gives you and your clients the opportunity to familiarise yourself with a new and improved way of submitting VAT Returns, and get ahead of the game before April 2019.

If you’re a Xero partner, you’ll first need to sign up for an Agent Services Account with HMRC to take part in the pilot. You can then head to Xero’s MTD for VAT beta sign-up page to get set up.

Who is not eligible?

Although the functionality has opened for a wider group of customers, some businesses will not be able to join this pilot. These businesses have more complex tax requirements and HMRC has granted them a delayed mandation of 1 October 2019.

Businesses that are not yet eligible to join the Making Tax Digital for VAT pilot are either:

Part of a VAT Division
Based overseas
Operate as a trust
A not for profit organisation not registered as a limited company
Submit annually or
Make VAT payments via account.

For more information on the eligibility criteria please see further guidance from HMRC.

Resources to help you with MTD

There are tons of useful updates and free guides on our Making Tax Digital resource hub. We recommend you check it out and utilise these resources.

If you still have questions on Making Tax Digital, contact your Xero Account Manager or email partnerteam@xero.com. If you’re a small business, please contact your advisor or touch base with our support team via Xero Central.

The post Making Tax Digital for VAT pilot now open to more businesses appeared first on Xero Blog.