Making Tax Digital
Making Tax Digital:
HMRC can now enforce digital links requirement. All VAT-registered businesses which are required to submit their returns electronically must, with effect from 1 April 2021, “digitally link” their business records to their VAT returns. This is a legal requirement of Making Tax Digital. You must keep your records so that VAT returns are produced automatically from the point you record primary information, e.g. figures from a sales invoice, tills etc.
Software requirements: You must use HMRC-approved bookkeeping software; this can include spreadsheets such as Microsoft Excel or Google Sheets. Whatever you use the data must flow automatically from the initial input to the VAT return. In practice, most businesses are already complying with this rule, but HMRC can now issue fines to those that don’t.
If you require any advice with regards to Making Tax Digital, contact us and we will ensure you are fully up to speed with the procedures.