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Making Tax Digital for VAT 2021 compliance dates

Olivia Larson, Assistant Manager, VAT and Customs Duty Services 
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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 on the next page 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.

Making Tax Digital for HAs

Our webinar provides an update on the latest position, incorporating all of the new information that has been issued by HMRC. We focus on practical issues and practical actions that Housing Associations are facing now MTD is in full effect.

Watch on-demand

 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?

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

Contact us

Adam Cutler
Adam Cutler
Director, VAT and Customs Duty Services