HMRC had their latest consultation on Making Tax Digital for VAT on 18th December 2018, which consisted of draft regulations and set out the plans in more detail. The changes will come into effect from April 2019.
Businesses with a taxable turnover above the VAT registration threshold will be required to preserve digital records and provide VAT returns using compatible software. In an addendum to the original draft, businesses will be allowed to use compatible and approved software alongside spreadsheets to provide VAT returns.
The good news is that HMRC are willing to listen to business’ concerns and software providers are working on suitable solutions. The bad news is the implementation of these major changes in April 2019 are still scheduled to clash with the looming Brexit date. Interesting times ahead!
For further information, please contact our VAT specialist, Nigel Smith.