From April 2022, all VAT registered businesses must sign up, whatever they earn. Before the government brought in this extension, only companies whose turnover was more than £85,000 had to sign up for MTD.
With less than a month left until the extension of MTD for VAT, according to QuickBooks, only 29% of businesses stated that they know how to become MTD compliant.
According to QuickBooks, 82% of small-business owners are unaware that MTD compliance starts in April 2022. On the 1st of April, MTD for VAT will be expanding to include all businesses registered to VAT, regardless of the turnover.
Companies must keep copies of their Making Tax Digital. This can be done using suitable software. There are tons of information available on the HRMC web and a list of compatible accounting software that includes recognisable software that uses simple spreadsheets for easier understanding.
A reminder that you must sign up to MTD at least seven days before you are due your first MTD VAT return; otherwise, you may end up paying. QuickBooks found that 26% of businesses put off MTD due to fear of making mistakes. However, MTD’s goal is to stop common errors by supporting businesses to save time by managing their tax.
Joanna Rowland, transformation group director of HMRC, states: “MTD is fundamental to delivering a trusted and modern tax system, making it easier for businesses to get their tax right and supporting the UK to go digital.”
For support on MTD and VAT, talk to us – we will be happy to help.