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Making Tax Digital for VAT – 2021 compliance dates

Nicholas Robson, Manager, VAT and Customs Duty
04/06/2021
Mobile phone and laptop

The new rules for Making Tax Digital (MTD) came into effect on 01 April 2021, but what does this mean in terms of your VAT return processes?

What has changed for phase 2?

Now is the time to review the VAT return processes and test them to ensure that you will be Phase 2 MTD compliant.

Previously, VAT returns did not need digital links between the accounting software and VAT workings to be MTD compliant. However, for periods starting on or after 1 April 2021, digital links are required between all elements of the VAT return.

Once the source document (invoices, expenses, import statements etc) are entered into the accounts system the digital link to the VAT submission must be maintained.  There are a few exceptions that allow some manual process but these are limited.

HMRC are clear that manual typing of figures or totals and cut and paste of information is not acceptable under the digital records rules and therefore, where possible formulas/pivot tables should be used.

Important dates

We have included a table below which outlines the VAT return by which you must be fully compliant, depending on when your VAT returns are normally due. It also shows the current VAT return which can be used as trial run for checking Phase 2 MTD compliance.

 

VAT Return Periods Phase 2 MTD Trial Run  Phase 2 MTD Compliance  Phase 2 MTD Compliance Deadline 
Monthly March 2021 (03/21) VAT return April 2021 (04/21 VAT return)  07 May 2021 
Mar/Jun/Sept/Dec March 2021 (03/21) VAT return June 2021 (06/21 VAT return) 07 August 2021 
Jan/Apr/Jul/Oct April 2021 (04/21) VAT return July 2021 (07/21 VAT return) 07 September 2021 
Feb/May/Aug/Nov May 2021 (05/21 VAT return August 2021 (08/21 VAT return) 07 October 2021 

Need more help?

Crowe are able to assist in reviewing your VAT return processes to help ensure you will be compliant under the new rules. Should you wish to discuss your MTD processes in more detail, please get in touch with Nicholas Robson (VAT Manager), or your usual Crowe VAT contact.

 

Webinar: Making Tax Digital

View our latest MTD webinar in which we covered all the important information to make sure you're prepared for the MTD phase 2 'hard landing' period.

Watch here

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Contact us

Robert Marchant
Robert Marchant
Partner, VAT and Customs Duty services
London
Robert Warne
Rob Warne
Partner, Head of VAT and Customs Duty services
London