MTD Accountants to Simplify Your Taxes
Making Tax Digital for VAT
Welcome to MTD Accountants in London
MTD is an abbreviation of Making Tax Digital. Well, it’s an overhaul of the UK tax system which replaces manual processes with digital ones. In simple words, HM Revenue & Customs wants small businesses to be more organised, therefore, from 1st April 2019 HMRC will expect you to keep all of your records digitally. There are many businesses in the UK that are using, but at least half of the businesses in the UK still use spreadsheets.
Under Making Tax Digital VAT known as ‘Making VAT Digital’ (MVD), most VAT-registered businesses are required to use ‘functional compatible’ software in order to record their transactions and report their VAT.
- MTD commences for the first VAT accounting periods commencing on or after 1 April 2019.
- It applies to VAT-registered business with a turnover above the VAT threshold (currently £90,000)
- Certain businesses are deemed as complex for VAT, their MVD start date is deferred and commences on the first VAT accounting periods on or after 1 October 2019. It is highly likely that your business will be considered as complex by HMRC.
With Making Tax Digital VAT around the corner we have decided to demystify some of the most common misconceptions surrounding MTD in our myth-buster infographic below.
Making Tax Digital – MTD Updated Journey:
A few of the highlights of MTD updates are
- Making Tax Digital was first implemented in April 2019 for small businesses and individuals who have turnover about the VAT threshold of around £85,000.
- In 2022 April, MTD rules were extended more to all VAT-registered businesses so any business that falls under the thresholds must use compatible software such as maintaining and keeping all records digitally and submit their tax return directly to HMRC.
- According to the new updates, from April 2026 MTD for income tax will be applied to related individuals and businesses i.e., landlords and unincorporated businesses with income over £50,000 followed by income over £30,000 from April 2027.
What are Digital Records?
Digital records must be kept on functionally compatible software. Digital records must record the following details:
- Business name
- Principal place of business
- VAT registration number
- Details of any VAT scheme used, such as Cash Accounting, Flat Rate Scheme, Annual Accounting, etc.
- A VAT account
- Information about the number of supplies:
- Time of supply
- VAT rate used
Why Hire Accotax as Your MTD Accountant?
MTD has many benefits no doubt, but while going digital you might face issues and you can take care of all with the help of our dedicated accountants at ACCOTAX. So, you can work on growing the firm, while we take care of your Making Tax Digital – MTD needs.
ACCOTAX have certified staff who are proficient in all accounting and financial solutions including MTD, bookkeeping, payroll management, taxation, etc.
Our competent staff is working in the industry for decades. Therefore, our experts will help in choosing the right software for digital recording of finance and also help in maintaining all your accounting details.
Should you have any questions or need further information, please do not hesitate to contact us on 0203 4411 258 or [email protected].
