How Making Tax Digital Will Impact Platinum
As a result of the UK government initiative known as Making Tax Digital (MTD), all UK VAT registered businesses will have to maintain digital records and electronically submit their VAT returns to HMRC from April 2019. For each individual company in Platinum with its own unique VAT registration number, there will be an inbuilt link to submit VAT Returns to HMRC. Our Platinum Software can upload to HMRC for payroll, VAT100 and Making Tax Digital (MTD) on-line submissions. Making Tax Digital was available in Platinum release 2018-12-12.
HMRC recognises the Platinum product as supporting MTD for VAT purposes and you can view Catalyst Computer Systems – Platinum Software in the list of software for Making Tax Digital here.
Third-party software
If your business operates multiple companies with the same VAT registration number or uses multiple accounting systems, you have a couple of options: Platinum can provide the ability to make adjustments at a high level and this method could be used to enter information for another company to include in the single VAT return. Alternatively, third-party software could be used to consolidate the values together for submission. HMRC will be publishing a list of products that can be used.
The changes made to Platinum will not apply to cash accounting systems. If your business operates under cash accounting rules, you will need to submit your return outside of Platinum using third-party software.
What do you need to do?
If you haven’t already, you will need to check all existing Zero Rated or Exempt VAT Rates to ensure the correct VAT type has been selected. This needs to be carried out as soon as possible and before running a VAT return. For example, zero-rated sales/purchases to an EU country are categorised differently on the VAT return from the zero-rated UK transactions.
Then the VAT Health Check should be run to identify any other areas that may need to be checked and corrected. This should be done as soon as possible in order to ensure your company is ready for VAT Return processing.
Internal processes will also need to be examined. For example, it will be necessary to close the nominal month end for the period before a VAT return can be finalised and submitted. This could also have a significant impact on year-end processes.
VAT payment deadlines
Making Tax Digital begins on your first complete VAT period starting after 1st April 2019. From this date it will be mandatory for you to submit your tax returns digitally to HMRC.
HMRC standard deadline for payment of VAT is one month and seven days after the end of the VAT period. More information on deadlines is available right here.
Need more details?
To get more information on how MTD will affect your business and what actions you should take, be sure to check out these HMRC and government webpages.
Click here to view an article designed to guide you towards help and information regarding the introduction of Making Tax Digital.
Click here to find out how to authorise Platinum for Making Tax Digital.