Making Tax Digital

BoGoF · 11 January 2019 at 8:51AM

Update on .GOV site yesterday

https://www.gov.uk/guidance/use-software-to-submit-your-vat-returns#who-can-use-this-service

DropTheNeedleAndPray · 18 January 2019 at 3:31PM

My main issue with this proposed system is that it must be aimed at virtually all businesses (£85k isn't exactly a king's ransom for turnover).

The government have listed hundreds of software types but what is good for the sole trader won't be appropriate for BP, for example. So, us small traders have no guidance as to what is at the easy, cheap end of the scale and as mentioned above, it's all totally overwhelming (and I'm IT literate - god help a technophobe).

Star_Style · 19 January 2019 at 1:32PM

I just read on the HMRC's site that you are allowed to copy and paste the information into the boxes until 2020.

Hopefully, everyone will be able to choose the right software before then.

Or the HMRC might have developed free software for smaller businesses to use.

I am going to keep checking HMRC over the next 6 months and then make a decision.

Anyone else got a suggestion?

cazzybabe · 21 January 2019 at 2:58PM

So, I am not good with technology but I do use sage instant accounts 2014... it has, to date done everything I need it to including my vat. However, when it has worked it all out, I then go into government gateway to copy the figures over.
My questions are:
1. Will I have to comply to MDT, even though my turnover does not exceed the vat threshold? (Our business has taken a dramatic down turn due to personal circumstances, and I will be de-registering in a year or so when we have re-modelled the business).
2. Will I have to buy new sage software?
Thank you for reading, all help appreciated

baz2277 · 22 January 2019 at 12:47PM

I've just started looking a bit more thoroughly into MTD - by the sounds of it, ALL vatable businesses have to file via this method from April 2019. At the moment the change is, to put it mindly...a pain in the ****!!!!

I currently have a simple excel spreadsheet with the following columns :

Date
Invoice Ref
Supplier
Purchase Category
Cost net of vat
Vat amount
Gross Amount

Plus a further few columns to say when payment was made and how payment was made.

Looking into just one of the recommended programmes - quickbooks, they are charging a monthly fee and when i've signed up for the trial, the amount of information you need to input seems ridiculous.

I don't want to have to input all my labour, link my bank account etc etc etc - it's worked fine for me for the last 6 years and I don't see why I should change! I can't even merge my current spreadsheet files into it at the moment. I think it needs a much simpler programme.

HMRC are saying this will help avoid people putting the wrong figures in - I think there's far more room for error using MTD than there was with the original method.

Rant over!!

Pennywise · 22 January 2019 at 1:34PM

1. MTD only applies to VAT registered businesses whose turnover exceeds the threshold for registration, so, no, not all VAT registered businesses at all. If your turnover is under the £85k threshold, then you don't need to worry about MTD yet.

2. Accountants and their professional bodies have been lobbying HMRC for a long time now to get the April compulsory MTD scrapped as we know it's a fiasco that will cause a lot of work for no benefit. HMRC won't listen though and are pressing ahead. Even the House of Lords has criticised HMRC and told them to delay it's introduction! Talk about a car crash waiting to happen.

3. QB isn't the only accounting software - just one of the most highly marketed ones which is why you've heard of it. There are plenty of alternatives, many of which are a lot simpler and cheaper. You'd be wise to ask your accountant for their advice. We tend to recommend a simple desktop system called VT (https://www.vtsoftware.co.uk) which is as quick if not quicker than a spreadsheet for data entry. They have a free cash book version or a paid for (one off lifetime purchase price of around £120?) which has sales/purchase ledgers if you need those. It's well used and highly recommended by lots of accountants and book-keepers and is very quick and easy to learn. For online systems, there are cheaper ones compared with Quickbooks, such as Pandle, Accountsportal, clearbooks, and freeagent.

baz2277 · 22 January 2019 at 4:16PM

Thanks for your reply and comments - My turnover is around the £300k mark so I'vegot no way of avoiding it sadly! I did take advice from the accountant, it was them who suggested quickbooks - they are just as frustrated as me, and I have seen the list of suppliers - but don't really want to spend hours going through each individual one to see what each offers.

I really feel that HMRC should be providing the relevant software to enable this free of charge. A very very simple way of incorporating a basic spreadsheet into what they require. It'd be easier for me to send them PDF's of my monthly sheets - that's 2 pieces of paper I can scan in less than 1 minute!!

I actually first heard about MTD on BBC Radio 4 during Moneybox last autumn, not a thing before this from HMRC. I wonder if they will completely remove the normal filing option from the website after 1st April?!

00ec25 · 22 January 2019 at 8:00PM

baz2277 wrote: »

A very very simple way of incorporating a basic spreadsheet into what they require. It'd be easier for me to send them PDF's of my monthly sheets - that's 2 pieces of paper I can scan in less than 1 minute

what they require is a full list of the underlying transactions making up each return in a format they can interrogate. A pdf won't cut the mustard as it would be the equivalent of sending them a wax tablet and stylus.

Pennywise · 22 January 2019 at 8:43PM

baz2277 wrote: »

Looking into just one of the recommended programmes - quickbooks, they are charging a monthly fee and when i've signed up for the trial, the amount of information you need to input seems ridiculous.

I'm no fan of QB but don't be put off - you don't have to fill in every box of the supplier details nor purchase invoice entry field. You can leave most fields blank if you don't need them, such as supplier address, phone number etc, purchase order number, payment terms etc. Ignore everything you don't need and just enter the basics just the same as your spreadsheet column list. Like most other software, 95% of the functionality/features in QB aren't usually used by the average business - they're there if you need them but aren't obligatory. Perhaps if your accountant had shown you around QB and offered to help you set it up, you'd have a better opinion of it.

Adeypocock · 24 January 2019 at 3:30PM

Floti wrote: »

Hey!

You don't have to register if you are under the threshold of £85,000
Some accounting software will help you in either case and for free. I use Bokio for my small business, it's easy and free.

Hope this helps!

Bokio doesn't seem to be in the HMRC's list of software.

I just use OpenOffice spreadsheet for my bookwork. I am sole trader & I am a bit over the £85k limit for VAT and for the last few years have entered my VAT manually on the HMRC portal. I just found out at the start of December that as of April this will no longer be acceptable. I can't justify spending money either paying someone to submit VAT for me or buying/subscribing for a software package.

I am very IT literate and this is keeping "me" up at night! I wonder what less teccy small buisinesses are feeling?

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