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Making Tax Digital Update

November 8, 2019 by JSO

Help Us to Help You with accurate MTD VAT returns

From October 2019, any businesses which were previously deferred from having to comply with Making Tax Digital (MTD) for VAT will have to file their returns in line with the new rules.  At the outset of MTD, HMRC announced a deferral period for business which fell into certain categories (see the link below):

www.gov.uk/government/publications/making-tax-digital/overview -of-making-tax-digital

Switching to digital accounts feels like an unnecessary hurdle for many small businesses.  Just Simply Organised are bookkeeping specialists and are more than happy to transform your box of paperwork into accurate, reliable accounts, enabling the filing of comprehensive VAT returns, which are fully compliant with MTD rules. MTD does not only mean that returns have to be filed digitally, it requires that clients have a full digital record of all transactions.  We can help you with the transition from manual spreadsheets to digital accounts, taking away that admin burden and allowing you to get on with running your business.

It is very tempting to think that photos of receipts and invoices will suffice, but do remember that HMRC still ask for hardcopy paperwork in the case of an investigation.  Even if you use software where you can transfer photos of receipts directly into the software, you often still have to log in and make the relevant entry manually and the photo is kept alongside this entry; just taking the photo is not enough – the relevant bookkeeping entry still has to be made.

Once we are filing your VAT returns under HMRC’s new Making Tax Digital regulations, it is important that we have all paperwork for the quarter.  When we file your VAT return, we have to sign a declaration which confirms that the submission is a true and accurate account of all of the transactions in the relevant period.  Just Simply Organised cannot do this if we are aware that we are missing some paperwork and, therefore, have no choice but to post the missing item to director’s loan or drawings as appropriate.  This means that the item will not be an allowable expense for tax or VAT purposes.

It is, therefore, very important that you are able to let us have all invoices and receipts which are dated in the quarter; please note that it is the actual date of the paperwork, not when the item was paid that is important.

We are increasingly finding that businesses are using other payment platforms such as Amazon, Paypal, Ebay etc. for business purchases.  We will need all of the paperwork relating to these online transactions, which must be in the name of the business, if a Limited Company, or the owner of the business in respect of a sole trader or partnership.  We are repeatedly having to request that clients revert to the supplier to obtain a revised VAT invoice in the correct name. Why not take a little time today to set up accounts in the business name with the platforms you use most often?

Please help us to help you by letting us have all of your paperwork for the period and responding to any queries as soon as you are able.  Thank you.

All content provided in this blog is for information purposes only. The owner of this blog makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site.

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