Businesses ‘not ready’ for MTD deadline
With less than two months to go before the deadline for Making Tax Digital (MTD) for VAT, many businesses are still not prepared, according to a report by software provider Advanced.
The first businesses that are VAT-registered and have an annual taxable turnover of more than £85,000 will be the first to be mandated into the government scheme, from 1 April 2019.
However, in a survey of more than 1,000 business professionals, only 57% said they will be ready for the MTD rollout, while 35% admitted they don't know whether they'll be ready or not.
Jon Wrennall, chief technology officer at Advanced, said:
"The Government is right to implement initiatives that mean organisations need to become more digital, but our research suggests that not enough support is being given to help them prepare."
MTD is intended to modernise the tax system, and make it easier for businesses and eventually individuals to record and report their tax accurately.
Those included will be required to keep digital records and file quarterly and year-end returns with HMRC through compatible software.
HMRC hopes to have most of the UK's 2.67 million VAT-registered businesses mandated into MTD by 1 June 2019, although VAT-registered businesses with more complex accounts have until 1 October 2019.
The first VAT returns will be submitted using compatible software from the start of their first VAT return period beginning on or after 1 April 2019, or 1 October 2019 if they are covered by the six-month deferral.
We can help you prepare for MTD.