Making Tax Digital for VAT is the first step in HMRC’s plan to digitise the UK’s taxation system.
Originally Making Tax Digital (MTD) for VAT was only a requirement for VAT registered businesses with turnover in excess of the VAT registration threshold of £85,000. However, from April 2022, all VAT-registered businesses will be required to keep digital VAT records and submit VAT returns via MTD-compliant software, regardless of their turnover.
This means that voluntarily VAT-registered businesses generating revenues below the £85,000 threshold will have to comply from 1st April 2022.
Making Tax Digital for VAT will apply to the first VAT return starting on or after April 2022.
Is MTD for VAT a legal requirement?
Businesses with revenues that exceed the £85,000 VAT threshold have been required to comply with Making Tax Digital for VAT since 1st April 2019.
As of 1st April 2022, all VAT-registered businesses must legally comply with Making Tax Digital for VAT, regardless of turnover size.
At AEL Markhams we can help you seamlessly transition over to a cloud based accounting system that suits your needs, there are so many out there to choose from and we understand that moving systems is always daunting. Please call our office for a free 15min consultation with our in-house systems specialist who will be able to offer you a simple cost-effective digital solution to ensure you are MTD compliant.