MTD VAT launches 1st April 2022: Know when to sign up
Making Tax Digital (MTD) is the UK government’s plan to make it easier for businesses to get their tax reporting correct and to keep on top of their tax payments by moving to a fully digitised system.
MTD became mandatory for most VAT registered businesses with a taxable turnover at the current threshold of £85,000. The next phase is coming into force on 1 April 2022 for all other VAT registered businesses.
If you are going to be impacted by MTD, its crucial you know the timeline when to sign up for MTD to stay compliant with HMRC.
When you should sign up for MTD VAT
Once you are signed up for MTD VAT, HMRC will expect the next VAT return due to be submitted under MTD, so it is vital to sign up at the right time.
Do not sign up unless you are confident you can submit your next VAT return using MTD compatible software.
Do not sign up to submit the current period VAT return until the previous period's return has been submitted.