Author Topic: MTD for VAT  (Read 2090 times)

SoreTween

  • Most of me survived the Pennine Bridleway.
MTD for VAT
« on: November 23, 2018, 11:53:46 am »
Making Tax Digital needlessly complicated  >:(

There are now 5 months until the nice, easy Web portal for submitting VAT returns gets switched off in favour of something vastly more complex. The Lords have just issued a report on this giving HMRC a total roasting but I don't want to get into the politics. Are you ready? I'm not.

All to save the complexity and human error in filling out 7 numbers in an online form.
2019 targets: TINAT 160 rough
There is only one infinite resource in this universe; human stupidity.

Woofage

  • Ain't no hooves on my bike.
Re: MTD for VAT
« Reply #1 on: November 23, 2018, 03:37:00 pm »
The whole thing's a total joke, but then the VAT division of HMRC has some serious form (as I'm sure any VAT registered business owner will tell you ::-)).

Our accountant told us they (HMRC) want to collect more data. I guess they might stop at wanting the breakdown of every single transaction made, or will they? Tesco and the like must produce a few, for example.
Pen Pusher

SoreTween

  • Most of me survived the Pennine Bridleway.
Re: MTD for VAT
« Reply #2 on: November 23, 2018, 05:32:20 pm »
Cheapest solution for me found so far is this:
https://www.neilsonjamestech.co.uk/vat-summary.php
At £36 a year it will 'only' cost me nine quid each time I do a return. Even that little grates for a 90 second job.  It also means I need to keep a Windows PC beyond January 2020, something I have been working steadily to avoid.  Searching for a libreoffice on Linux equivalent has so far drawn a blank.
2019 targets: TINAT 160 rough
There is only one infinite resource in this universe; human stupidity.

Woofage

  • Ain't no hooves on my bike.
Re: MTD for VAT
« Reply #3 on: November 23, 2018, 05:51:39 pm »
I looked at that co's website a little while ago. Looks like they've moved forward a bit, which is good.
Pen Pusher

Jaded

  • The Codfather
  • Formerly known as Jaded
Re: MTD for VAT
« Reply #4 on: November 23, 2018, 05:56:46 pm »
I'm all fingers crossed that I don't have a year when I cross the VAT threshold. I'm registered, but that was because most of my clients are large corporations and there was a risk in the beginning that I'd hit the threshold.

It beggars belief that they are doing this. There should be a threshold of, say £500k or £1m, instead of slapping another financial burden on small businesses. I would have to go to the subscription version of my accounts package, at £170 per year.

As has been said above, we have to do returns anyway (else we get bashed about) and we do them electronically now. It's rubbish.
If you don't like your democracy, vote against it.

Re: MTD for VAT
« Reply #5 on: November 23, 2018, 06:23:08 pm »
Making Tax Digital needlessly complicated  >:(

There are now 5 months until the nice, easy Web portal for submitting VAT returns gets switched off in favour of something vastly more complex. The Lords have just issued a report on this giving HMRC a total roasting but I don't want to get into the politics. Are you ready? I'm not.

All to save the complexity and human error in filling out 7 numbers in an online form.

Is there a description anywhere of what this "something vastly more complex" actually is?

Agree that the threshold should be more like a million rather than the what 80k that it currently is?


It is what it is. It's not what it's not, so it must be what it is.

Jaded

  • The Codfather
  • Formerly known as Jaded
Re: MTD for VAT
« Reply #6 on: November 23, 2018, 06:32:16 pm »
Basically instead of inputting the 7 or so figures into an on-line form you will have to have an accounts package that can directly upload the same data to HMRC.

So bye bye doing your accounts on a package that won't do that.

There's some gubbins about HMRC getting a better handle on how much revenue they are going to get. I don't understand that, unless they go to monthly VAT reporting...
If you don't like your democracy, vote against it.

Re: MTD for VAT
« Reply #7 on: November 23, 2018, 06:35:36 pm »
ah right I see... but will it have to be third party, or will HMRC supply their own like they do for RTI?
It is what it is. It's not what it's not, so it must be what it is.

Woofage

  • Ain't no hooves on my bike.
Re: MTD for VAT
« Reply #8 on: November 23, 2018, 06:42:27 pm »
One of the reasons behind the move, AIUI, is to eliminate potential errors arising from re-entering figures from, say, a spreadsheet into the VAT submission portal. If the data is linked, an error can't occur. I get this part but it doesn't prevent errors upstream so IMO the point is somewhat moot.

I don't know why HMRC can't just allow a CSV import from a spreadsheet. The data won't be any less accurate than it is currently for Excel/LibreOffice etc users and nor does it prevent direct MTD uploads from dedicated accounts software.
Pen Pusher

SoreTween

  • Most of me survived the Pennine Bridleway.
Re: MTD for VAT
« Reply #9 on: November 23, 2018, 08:56:33 pm »
ah right I see... but will it have to be third party, or will HMRC supply their own like they do for RTI?
Nope, open your wallet for something commercial. The cheap option I linked above looks like being a short term solution. The intention is to force us to use software that can respond to requests for more detail from the robbinyou.

I'm surprised the beancounting industry isn't making war. Sure there mistakes made, I've done a couple. You simply make the correction in the next quarter. If I don't spot my error I expect my accountant to at year end, they are the defence against mistakes going uncorrected. The implication in this is HMRC don't trust accountants.
2019 targets: TINAT 160 rough
There is only one infinite resource in this universe; human stupidity.

Re: MTD for VAT
« Reply #10 on: November 23, 2018, 10:52:26 pm »
Quote
The implication in this is HMRC don't trust accountants.
After the problems at Carillion, etc would you trust accountants?

Re: MTD for VAT
« Reply #11 on: November 24, 2018, 09:42:42 pm »
ah right I see... but will it have to be third party, or will HMRC supply their own like they do for RTI?
Nope, open your wallet for something commercial. The cheap option I linked above looks like being a short term solution. The intention is to force us to use software that can respond to requests for more detail from the robbinyou.

I'm surprised the beancounting industry isn't making war. Sure there mistakes made, I've done a couple. You simply make the correction in the next quarter. If I don't spot my error I expect my accountant to at year end, they are the defence against mistakes going uncorrected. The implication in this is HMRC don't trust accountants.
Any reason I couldn't write my own? Surely HMRC must publish the specification for the API at least?


My issue is not with paying for something, but with paying a fly by night, that's no better if not worse than I am at writing software, and that's no better if not worse than me at understanding the interface specification. If HMRC only supply the spec to select chosen companies, fine, they must have been vetted/carefully selected so I'll just choose one of them. If there's no recommended supplier (s) and you have to just get the software off anybody, I'd rather get the API spec and do it myself.
It is what it is. It's not what it's not, so it must be what it is.

SoreTween

  • Most of me survived the Pennine Bridleway.
Re: MTD for VAT
« Reply #12 on: November 25, 2018, 08:26:57 am »
Any reason I couldn't write my own? Surely HMRC must publish the specification for the API at least?


My issue is not with paying for something, but with paying a fly by night, that's no better if not worse than I am at writing software, and that's no better if not worse than me at understanding the interface specification. If HMRC only supply the spec to select chosen companies, fine, they must have been vetted/carefully selected so I'll just choose one of them. If there's no recommended supplier (s) and you have to just get the software off anybody, I'd rather get the API spec and do it myself.
The API is publicised and HMRC provide a sandbox:
https://developer.service.hmrc.gov.uk/api-documentation/docs/using-the-hub
2019 targets: TINAT 160 rough
There is only one infinite resource in this universe; human stupidity.

Re: MTD for VAT
« Reply #13 on: November 25, 2018, 08:37:55 am »
I'd not heard about this.
sounds like a pain. I do mine in excel and would rather keep it that way.
I once worked on an acquisition of an accounting software company and saw what margins they made and how poor customer service was across the market. Being more or less compelled to be a customer of one of them is annoying.

Jaded

  • The Codfather
  • Formerly known as Jaded
Re: MTD for VAT
« Reply #14 on: November 25, 2018, 08:52:10 am »
I think the only way you don’t have to do it is if your turnover is below the VAT threshold.

If you don't like your democracy, vote against it.

Re: MTD for VAT
« Reply #15 on: November 25, 2018, 10:20:03 am »
Any reason I couldn't write my own? Surely HMRC must publish the specification for the API at least?


My issue is not with paying for something, but with paying a fly by night, that's no better if not worse than I am at writing software, and that's no better if not worse than me at understanding the interface specification. If HMRC only supply the spec to select chosen companies, fine, they must have been vetted/carefully selected so I'll just choose one of them. If there's no recommended supplier (s) and you have to just get the software off anybody, I'd rather get the API spec and do it myself.
The API is publicised and HMRC provide a sandbox:
https://developer.service.hmrc.gov.uk/api-documentation/docs/using-the-hub

Interesting, cheers. Will have a look.

It is what it is. It's not what it's not, so it must be what it is.

SoreTween

  • Most of me survived the Pennine Bridleway.
Re: MTD for VAT
« Reply #16 on: November 25, 2018, 01:55:44 pm »
I think the only way you don’t have to do it is if your turnover is below the VAT threshold.
I think if you are registered for VAT you need to do it.  I help out with a company that is below the threshold for compulsory VAT registration but is registered so that VAT on expenses can be reclaimed.  That company can avoid the MTDfV pain but only be de-registering and so losing the ability to reclaim.
2019 targets: TINAT 160 rough
There is only one infinite resource in this universe; human stupidity.

Jaded

  • The Codfather
  • Formerly known as Jaded
Re: MTD for VAT
« Reply #17 on: November 25, 2018, 02:34:15 pm »
A quote:

Quote
On 13 July 2017, the Financial Secretary to the Treasury and Paymaster General announced that Making Tax Digital for VAT will come into effect from April 2019. From that date, businesses with a turnover above the VAT threshold (currently £85,000) will have to:

keep their records digitally (for VAT purposes only), and
provide their VAT return information to HM Revenue and Customs (HMRC) through Making Tax Digital (MTD) functional compatible software


Now, if they remove the current way of reporting, that’s a problem.

There is also a note that it might become compulsory to all VAT registered businesses the year after.
Apparently income tax and corporation tax will be going the same way.
If you don't like your democracy, vote against it.

Re: MTD for VAT
« Reply #18 on: November 25, 2018, 09:17:53 pm »
Not quite as bad as I feared.
It looks like there are free systems available which will bridge between excel and the mtd system.

https://www.accountingweb.co.uk/tech/accounting-software/mtd-avalara-bridges-the-spreadsheet-gap

T42

  • Tea tank
Re: MTD for VAT
« Reply #19 on: November 26, 2018, 10:58:29 am »
Reading this lot ^^^^ makes me glad we closed our company two years ago.  On the 21st of every month I still wake up with a little surge of adrenalin and "it's VAT day!" slinking across the back of my mental stage.
I've dusted all those old bottles and set them up straight.

Woofage

  • Ain't no hooves on my bike.
Re: MTD for VAT
« Reply #20 on: November 26, 2018, 11:45:51 am »
Not quite as bad as I feared.
It looks like there are free systems available which will bridge between excel and the mtd system.

https://www.accountingweb.co.uk/tech/accounting-software/mtd-avalara-bridges-the-spreadsheet-gap

Useful, thanks. I'll get the boss to look at it.
Pen Pusher

SoreTween

  • Most of me survived the Pennine Bridleway.
Re: MTD for VAT
« Reply #21 on: November 26, 2018, 02:10:45 pm »
July is the earliest we will have to worry about this, the 1st April date is for start of VAT periods not submissions.
My Jan-Mar submission which will be done late April will NOT be electronic.
My Apr-Jun submission in July will be electronic.
Lucky old me being aligned to the calendar quarters, I'll be in the first batch of submissions so I better set aside the whole of July to deal with the systems going TITSUP.
The last to join the party in September is those who have Mar-May (old style) & Jun-Aug (MTDfV) VAT periods.
2019 targets: TINAT 160 rough
There is only one infinite resource in this universe; human stupidity.

Re: MTD for VAT
« Reply #22 on: November 27, 2018, 08:33:24 pm »
AIUI a lot of sole traders do no work for the last couple of months of each financial year, living off savings, just to stay below the threshold and avoid a world of pain.  In a mostly-labour business like Fixing Stuff, you really don't want to be VAT-registered as you have virtually no input costs to help offset it and will simply be 20% more expensive than the next guy who manages to stay unregistered.
Never tell me the odds.

Jaded

  • The Codfather
  • Formerly known as Jaded
Re: MTD for VAT
« Reply #23 on: December 07, 2018, 07:37:32 pm »
Just filled out my VAT return in the old way. The pages have a warning on them now:

Quote
If you have signed up for the Making Tax Digital pilot you should not use this service to file your return. You must file using MTD compatible and enabled software. If you file using this portal your return will not be received.

From 1 April 2019 all VAT registered businesses making taxable supplies above the threshold (£85,000) have to submit their returns using Making Tax Digital compatible software. For more information including how to join the pilot click here.

This suggest that this system will carry on for those below the £85k limit.

Also what I think is a new box to tick that declares that you have calculated the figures properly  ::-) You can't progress until you've ticked it.
If you don't like your democracy, vote against it.

Re: MTD for VAT
« Reply #24 on: December 07, 2018, 10:05:14 pm »
Do you think that means that even if you're vat registered you can still do returns like you do now if you don't earn 85k, but only once you get to 85k do you have to start using mtd? Or just that if you don't make 85k you don't have to be registered? ( I know it's not entirely clear/ open to interpretation!)
It is what it is. It's not what it's not, so it must be what it is.