MTD – reprieve for late filers
One in ten businesses failed to submit their VAT return using the Making Tax Digital (MTD) service by their 7 August 2019 deadline. However, HMRC has waived penalties in a concession announced in advance because of the slow sign-up to MTD.
Most VAT-registered businesses with taxable turnover above £85,000 are required to keep digital business records and send VAT returns using MTD-compatible software for accounting periods that started on or after 1 April 2019. For businesses with a VAT period starting on 1 April 2019, the first returns under MTD were due on 7 August 2019.
Businesses that missed the deadline for signing up for MTD were told that penalties would not be charged – provided they submitted their returns by 7 August using the old HMRC VAT return portal. To comply with the MTD rules in future, they must obtain the necessary software and sign up to MTD before their next return is due.