MTD Pilot opens up to more businesses

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HMRC is maintaining momentum in the introduction of Making Tax Digital for VAT (MTDfV) as we head towards the deadline for implementation.

Partnerships and Flat Rate Scheme users are now able to join the voluntary public pilot and gain experience before April 1.

This following successful private testing of the MTD VAT service, conducted with a small number of invited businesses and agents.

The announcement is a positive step after a setback at the end of 2018, when HMRC revealed businesses with complex affairs would be given an extra six months to switch to MTDfV.

HMRC has now published its definitions for excluded firms, which are expected to affect up to 40,000 businesses.

HMRC says businesses will not take part in MTDfV until October if they:

  • currently trade with, or have traded with the EU
  • are part of a VAT group or VAT Division
  • are based overseas
  • are a trust
  • are a not for profit organisation that is not set up as a company
  • submit monthly or annual returns
  • make VAT payments on account
  • are a business that is newly registered for VAT that has not previously used their VAT online account to submit their VAT Return.

When VAT is paid by direct debit, the business will not be able to sign up in the 15 working days leading up to their submission date and the 5 working days immediately after it.

HMRC has indicated that the pilot will be opened up to more businesses in due course and to regularly check their website to see if it has been extended.

The content team are the owners of AAT Comment.

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