Most UK businesses that were VAT registered on a compulsory basis were obliged to sign up for ‘Making Tax Digital’ (MTD) from April 2019. At that time, there were exemptions available including any person or entity that had a voluntary VAT registration.

Fast forward to the present and the rules have now been extended to bring in everyone that is VAT registered and the new Making Tax Digital for VAT rules take effect from the first VAT Period commencing on or after 1st April 2022.

Will Making Tax Digital for VAT apply to me?

These rules apply to you if you are VAT registered but are not currently required to file under MTD; this includes individuals who are self-employed, partners, landlords and any other person or entity who registered voluntarily.

It is a requirement that people and businesses that are affected, must register for MTD then keep electronic records so that their VAT Returns can be submitted directly via computer software. There will no longer be the option to just enter numbers into boxes direct on the HMRC website.

For those who have a voluntary VAT registration, it might be possible to avoid the need for MTD by considering deregistration. If that applies to you, you will need to get specific advice since each circumstance will be different and there will be a minimal number of cases where deregistration is actually prohibited or would create a VAT liability.

What do I need to do now?

If you are a Lambert Chapman client, you should’ve received specific instructions from us and our team will ensure that this is being dealt with by the 1st April deadline. If you have any questions, please get in touch with your usual contact and we will be happy to assist.

Our advice for anybody else is to register via GOV.UK and check that your software is compliant as there are a number of different options available to you.

Should you require any further assistance or advice about Making Tax Digital for VAT, please get in touch with Sean Wiegand.

The views expressed in this article are the personal views of the Author and other professionals may express different views. They may not be the views of Lambert Chapman LLP. The material in the article cannot and should not be considered as exhaustive. Professional advice should be sought in connection with any of the issues contained in the article and the implementation of any actions.

Lambert Chapman Chartered Accountants

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