From the 1st April 2019 the vast majority of businesses will need to keep records digitally for VAT purposes. All VAT-registered companies turning over above £85,000 will have to comply.
When looking for software to perform the VAT returns, the business must seek out MTD for VAT-compliant accounting. A business must look out for something that is affordable, simple and easy to use.
The software should also be cloud-based. This will allow authorised users in the business to look at VAT returns at any time of the day or night. The software you should look out for might have many user-friendly and dynamic features available:
- Dashboard Control – This will give you at-a-glance header figures listing key data with one look.
- Control of Submissions Data – both companies and individuals are obligated to pay VAT and to have all the data registered and submitted to HMRC by certain dates.
- VAT Reports and Graphs – MTD for VAT software should have a Report Centre where you can check refunds and monies paid.
- Obligations Dashboard – This is basically a reminder of the dates when submissions should take place. Reminders of how many days to go until VAT returns data is expected and a list of all receipts that have been submitted for VAT exclusion.
A business must look out for software that will validate and submit the data in a format that complies with HMRC requirements. This is not some arduous task; VAT submissions performed using MTD for VAT software are completed at the touch of a button.
There are distinct advantages for all: book-keepers, finance accountants, eligible businesses and self-employed individuals earning over the threshold (£85,000 at present). It will also make the workings at HMRC a lot tidier and cost effective.
A business that must comply with the MTD for VAT should look for software that will validate and submit business figures directly to HMRC at the touch of a key. You should also look out for a window view of refund history and any payments made through MTD for VAT.
Spreadsheets and Financial Packages
Many companies have been submitting its VAT returns on spreadsheets [such as Excel or Lotus 1-2-3] and will want to know if this method should now be discontinued?
But it is not necessary to discontinue using this format as long as you convert the data via MTD for VAT software. Fortunately, most VAT software can easily do this.