With Making Tax Digital having started on Monday 1st April, the CIOT and ATT are warning businesses against making a false start by signing up too early, as the consequences could be problematic for them and HMRC.
Adrian Rudd, Chair of the joint ATT/CIOT Digitalisation and Agent Strategy Working Group, explained further, “We are concerned at the misconception that in order to be compliant businesses must sign up to Making Tax Digital by the ‘deadline’ of 1 April 2019. This is wrong. While the requirement to maintain digital records applies to many businesses from 1 April, signing up to Making Tax Digital can, and in many cases should, be done at a later date.”
He added, “After a business signs up to Making Tax Digital it will no longer be able to submit VAT returns to HMRC through existing channels. Therefore, if a business which submits VAT returns on a calendar quarter basis signs up to Making Tax Digital today (1 April 2019), HMRC will expect the VAT return for the quarter ended 31 March 2019 to be submitted via Making Tax Digital software – it cannot be submitted, for example, by typing the VAT return figures into the portal. If the business has not planned for this it could have real difficulties submitting the VAT return or paying the VAT liability on time (or both), will need to work closely with HMRC to put things right, and may be at risk of penalties.”
“More than 70,000 businesses are now signed up to Making Tax Digital, the majority of which have done this themselves. We hope they have not jumped the gun, having misunderstood the requirements.”
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