Making Tax Digital (MTD)
If your business is VAT registered and your taxable turnover is greater than £85,000 then you will have been complying with MTD since April 2019.
MTD requires VAT records to be stored digitally and the VAT return to be submitted directly from those digital records without manual intervention. Where more than one piece of software is used, data should be transferred via digital link. However there would be a soft landing period of one year, where digital links would not be enforced, to allow businesses time to get their digital links in place.
With the soft landing period coming to an end, HMRC have extended the deadline. HMRC said “we are providing all MTD businesses with more time to put in place digital links between all parts of their functional compatible software. This means that all businesses now have until their first VAT return period starting on or after 1 April 2021 to put digital links in place."
