The introduction of Making Tax Digital legislation has already seen a number of Champion clients successfully switch to compatible online accounting platforms, such as Xero or Sage Business Cloud, by using the advice and guidance of our team to find the right software for their business.
Under the legislation, every business with a taxable turnover above the £85,000 threshold is now obligated to keep digital VAT records and submit VAT returns digitally for their first VAT period starting on or after 1st April. For example, if you have a VAT period that starts on 1st May, then you must be keeping digital VAT records from this date. You will also need to ensure you submit your next VAT return using Making Tax Digital compatible software.
Registering with HMRC
Those clients who do not use Champion as their appointed VAT Agent must remember to register for Making Tax Digital with HMRC, even if you are already operating through Xero or Sage Business Cloud.
To do so, visit the following link and follow the instructions – https://www.tax.service.gov.uk/vat-through-software/sign-up/have-software
Remember, if you pay your VAT liability to HMRC via direct debit, you must do this at least one week before your VAT return is due.
Once registered, many of the cloud accounting platforms, such as Xero, will link directly with the Revenue and display a new VAT dashboard, which includes a daily countdown until your next VAT return is due and an updated picture of your VAT liability in real time.
Choosing the right software
We have already supported many of our clients in successfully transitioning from manual cash books and spreadsheets onto both Xero and Sage Business Cloud. Those signing up to Xero through Champion have also benefitted from our 20% monthly discount thanks to our partnership with
the cloud accounting specialists. To find out more about the offer and how to take advantage of this saving, get in touch with your Client Manager today.
On average, a monthly subscription to one of the cloud accounting platforms costs around £20 – £30, which may be considerably cheaper than upgrading your current finance package, especially if you are operating an older version.
Those who rely on Excel, have a simple business or operate through a bespoke-built accounting platform, can still utilise spreadsheets for VAT calculations, as long as bridging software is used to retain a digital link with HMRC.
Get in touch with your advisor today
You are running out of time to remain compliant if you haven’t done so already. If you have any questions about Making Tax Digital then please get in touch with your Client Manager.
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