HMRC is reminding businesses that they will no longer be able to use their
existing Value Added Tax (VAT) online account to submit VAT returns from 1
November.
By law, all VAT-registered businesses must now sign up to Making Tax Digital
(MTD) and use compatible software to keep their VAT records and file their
returns.
According to HMRC, more than 1.8 million businesses are already using the MTD for
VAT service. Over 19 million returns have been successfully submitted through
MTD-compatible software so far, the tax authority adds.
From November, businesses who file their VAT returns on a quarterly and monthly
basis will no longer be able to submit them using their existing VAT online
account, unless HMRC has agreed they are exempt from MTD.
If businesses do not file their VAT returns through MTD-compatible software, they
may have to pay a penalty. Even if a business currently keeps digital records,
they must check their software is MTD compatible and sign up for MTD before
filing their next return.
Richard Fuller, Economic Secretary to the Treasury, said:
'MTD can help businesses get their tax right first time, which cuts the
administration burden and frees up time for them to get on with what matters
most to them – growing their business.'