New VAT requirements: "Making Tax Digital"

[rub1e]

Making Tax Digital (MTD) is an HMRC initiative designed to make sure the UK tax system is effective, efficient and easier for taxpayers.

Making Tax Digital for business (MTDfb) begins on 1 April 2019 with MTD for VAT. From that date, VAT-registered businesses above the threshold of £85k will have to keep digital records and submit VAT returns using compatible software. HMRC lists Xero as software that will be compatible with MTD for VAT.

Other components of Making Tax Digital, such as income tax and corporation tax, have been placed on hold until April 2020 at the earliest.

I've just skimmed a Xero article on this new VAT process. It wasn't really clear, but I think the way we record our receipts and submit through Xero means we're already compliant (but I'll still check to make sure and document any changes to the process)

• [x] Very brief spike to understand if there are any new reporting requirements on top of what we already do
• [x] Document any changes to process
• [ ] Do a pilot run for the next (January) VAT Return

[rub1e]

OK so Xero could have saved us time and bother if they'd not hidden this tidbit of useful info halfway down an FAQ page

Basically, we already are MTD compliant, no new documentation required - if that changes I'll update this issue. Otherwise I'll close it once we've submitted the Jan VAT return