We are ready for MTD – are you?

Making Tax Digital for VAT is less than 6 months away.  We are ready for it and have made sure all our customers know what changes they need to make too.  Are you ready for MTD?

80% of our customers use Xero to maintain their accounting records and we know that Xero software will be able to handle the submission of VAT returns under the new HMRC regime when it comes into force in April 2019.  We have had Xero Certified Advisors since we started using Xero in 2011 and we have completed Xero’s new qualification which covers Making Tax Digital giving us the knowledge to convert customers from their current software to Xero with ease.  We have been doing this for several years anyway but being able to
complete a structured qualification confirms that we are able to do this.  

We also work with Sage Accounts software and for several of our customers Sage is their preference.  Sage Accounts does become unsupported after just a couple of years but it is reliable.  Our clients rarely have issues  we can’t sort out so it doesn’t need to be updated to a new version very often but it is important to ensure Sage updates are applied when they are available.  However with MTD on the horizon it is important that Sage Accounts users do have the latest version of Sage 50 Accounts.  Sage will have a separate MTD module available to purchase which will enable submission of VAT returns under the new regime.  This is not available yet but anyone purchasing the latest version of Sage will receive it automatically.  All our Sage Accounts customers have now updated their software which will enable them to prepare for MTD.

Are you wondering whether you need to change your software for MTD?  When MTD becomes compulsory for VAT registered businesses from April 2019 you will need software that is able to submit VAT returns through the new HMRC portal.  This submission will be different to the submissions you currently do either through your accounts software or via the Government Gateway.  The new type of submission will not only take the summary figures but also the transactions which make up the figures on the return.  

The first quarterly VAT return due under MTD will be the quarter April to June 2019 with the first monthly one being due for the month of April 2019.

If you need to change to accounts software which will be ready for MTD it is always recommended that you make the change at the end of your financial year or, if you can’t do it then, at the end of a VAT quarter.  It makes accounting much more difficult to make the change in the middle of a month or in the middle of a VAT quarter so it is best to avoid doing this if at all possible.

It may not be possible to change software if the accounts element of it is only a very small part of what it does for your business but it is important to approach your software provider to find out when it will be MTD ready.  If you do need to change accounts software you need to find an alternative which will work for your business and you will need to plan how you are going to convert your data.  There are software companies which will convert it for you to import it in to other accounts software like Xero but it may be that this change would be a good time to start your accounts afresh.  If you are using a desktop accounts package you will still have your historical data even if your software isn’t up to date and sometimes it isn’t necessary to bring years worth of old data into a new system.  Having new accounts software is a chance to re-think your nominal codes and reporting and to clear out old customer and supplier records.

We have set up Sage and Xero for numerous businesses over the years and are therefore quite adept at getting your software up and running in the way you need it to. 

So if you need help to be ready for MTD let us know.