Making Tax Digital for VAT public pilot opens and deferral for some businesses

8th November 2018

HMRC has opened the Making Tax Digital for VAT (MTDfV) public pilot. However certain VAT-registered businesses (around 3.5% according to HMRC) with more complex requirements will be deferred from being subject to MTD for six months.

Essentially, the public pilot is now open to sole traders and companies using standard VAT accounting. This applies whether returns are done monthly or quarterly provided they are up to date. Those signing up for the pilot will be required to keep their VAT records digitally from the first day of the period covered by their next VAT Return and submit their return using the appropriate software.

Further piloting plans

HMRC intends to roll out further pilots for partnerships, those that trade with the EU and users of the Flat Rate scheme as set out in the timetable.

Date         Activity
Late 2018 Private testing begins with partnerships, those customers that trade with the EU, and users of the Flat Rate Scheme.
Late 2018 / early 2019 Open to other sole traders and companies who are not up to date with their VAT and businesses newly registered for VAT that have not previously submitted a VAT return.
Early 2019 Open to partnerships and those taxpayers that trade with the EU.

Six months’ deferral

Making Tax Digital for VAT is to be introduced from 1 April 2019. However, HMRC has announced that the mandated implementation has been deferred until 1 October 2019 for certain taxpayers:

  • trusts
  • ‘not for profit’ organisations that are not set up as a company
  • VAT divisions
  • VAT groups
  • public sector entities required to provide additional information on their VAT return (Government departments, NHS Trusts)
  • local authorities
  • public corporations
  • traders based overseas
  • those required to make payments on account (very large traders)
  • Annual Accounting Scheme users.

Pilot testing for these groups is expected to open in Spring 2019. For help with MTD please contact us.

Internet links: GOV.UK MTD overview MTD timeline



 
Other items in Blogs
 
Lucy Bayliss
11th April 2019 £10 a day from the 1st May!

If you submitted your tax return after the filing deadline of 31 January, or you still have not submitted your tax return, then you will automatically be fined £100 for missing the deadline.   In February, HMRC announced that they would be delaying issuing the late filing penalty notices due to Brexit. They have now…

Read More »

Matilda Mawson
10th April 2019 Has your claim for marriage allowance transfer been refused?

  HMRC have recently attempted to remove a marriage allowance transfer for a couple, where the transferor had less than the 10% personal allowance unused. This treatment is incorrect as outlined below:   Background to the transfer The marriage allowance transfer was introduced from 5 April 2015 onwards and allows a person to transfer 10%…

Read More »

Lisa Smith
9th April 2019 Digital Records for VAT – HMRC Guidance published

  From 1 April 2019, most businesses with a taxable turnover above £85,000 are required to follow the rules for Making Tax Digital for VAT.  As a result, HMRC has published new guidance on record keeping, which  explains what records a business needs to keep digitally if it has signed up for Making Tax Digital…

Read More »

Ian Piper
9th April 2019 R&D Tax Relief: HMRC Try to Tackle Abuse

  Many companies, not just those in the tech industry, will have benefitted from the generosity of R&D tax relief. Eligible R&D expenditure can be inflated by a notional 230% uplift, and a refund of tax claimed on tax that was never paid in the first place. Perhaps not unsurprisingly, HMRC have identified abuses of…

Read More »

Adrian Mackenzie
25th March 2019 When doing nothing is best

From time to time, stock markets go through periods of uncertainty. This could be down to some poor economic news or perhaps due to a political crisis.  The sharp falls that can be experienced at such times are understandably unsettling for investors. They can even tempt some to change their long-term plan by selling their…

Read More »

Thomas Carter
21st March 2019 Preparing for Brexit – Do you trade within the EU?

Your UK business may need an Economic Operator Registration and Identification (EORI) number if we leave the EU with no deal.   What is an EORI number?   An EORI number is a unique identifying number assigned to individual importers and exporters to track trade between the EU and non-EU countries. It’s used during Customs…

Read More »