As we approach April 1st and the end of the soft landing period for Making Tax Digital for VAT, we take a look at the current situation for businesses and agents.
Will anything change with the budget?
Last year, Rishi Sunak used the Budget in March to set out the £30bn support plan to help the economy weather the pandemic.
Later in March, HMRC announced that businesses could delay making their VAT payments between 20th March and 30th June 2020.
By April 3rd, we learned that HMRC was extending the soft landing period by 12 months to provide businesses more time to establish the full digital process and comply with Making Tax Digital for VAT rules.
And this month, the portal has opened to allow businesses to spread the cost of their deferred VAT payments.
It remains to be seen if further VAT support will be included in Mr Sunak’s Budget Statement on 3rd March. Jon Hickman at BDO has suggested that there may be some technical changes as a result of Brexit that could be expected to increase the VAT take.
Regardless of technical tweaks to VAT processes that emerge in the Budget, it seems unlikely that Making Tax Digital for VAT will see any further extension ahead of Small Businesses joining in 2022.
Soft landing period basics in brief
With so much information available about the soft landing period, we’ve broken it down into three key elements.
What is the soft landing period?
The soft-landing period was put in place by HMRC to allow businesses to get their digital links in place. After the soft-landing period, it will not be compliant to copy/cut and paste data for your VAT return. You’ll also need to submit the VAT return with MTD compatible software, like BTCHub. See how BTCHub works.
Digital links
You can record the data that makes up your VAT return in a spreadsheet even after the soft-landing period ends. Using BTCHub, you can either use your existing spreadsheet and link the data using formulas to summarise the data into your VAT return or continue to use your bookkeeping package and use CSV file exports to submit your data to HMRC.
Bridging software
HMRC confirms that bridging software remains compliant after April 2021. That means that if you’re our customer, you won’t have to look for alternative software to complete your VAT returns under Making Tax Digital rules.
Getting ready to leave the soft landing period
BTCHub is one of the most affordable Making Tax Digital for VAT solutions available to both Accountants and Businesses.
You benefit from:
- Supports returns for VAT Groups and multiple registrations
- Compliant with HMRC’s Making Tax Digital rules and updated regularly
- Cloud-based with easy browser login
- Compatible with Excel and bookkeeping software
- Automatic validation of returns with HMRC data
- Supports multiple unique users
- One comprehensive dashboard view for VAT obligations
Plus you get full telephone and email support included in the licence cost.
BTCHub is available now from our website for £260 +VAT. Buy making tax digital software and we’ll send you an email with your login information.
