Making Tax Digital: 1 Million Businesses Still Left To Comply

Although the government initiative Making Tax Digital is now live, it is estimated that around 1 million businesses still need to sign up. Approximately only 70,000 businesses have now registered, which is 4% of all UK businesses.

A Freedom of Information Request submitted to HMRC by cashflow forecasting software firm Float has revealed that approximately 3,000 companies are registering for Making Tax Digital per day – although this might seem like a large amount, it is still concerning as this means that only around 402,000 more businesses will have signed up by August, which is when most digital quarterly VAT returns will need to be submitted.

Making Tax Digital was introduced by HMRC to benefit businesses by making VAT returns easier, more accurate and it also helps to keep the taxpayer’s details all in one place.

Does your business still need to sign up?

If you have a taxable turnover of £85,000 and you have still not signed up for Making Tax Digital, you need to make sure that you are registered in time for one week before your first VAT return is due for the period beginning after 1 April.

You can sign up for Making Tax Digital through HMRC’s online portal – but before doing this, you need to make sure your business has MTD compatible software. If you do not yet have software that is MTD compatible, there is a tool on HMRC’s website which can be used to find the MTD compatible software that’s right for you, and you can use the tool by following this link.

Once your business has MTD compatible software, you will be able to sign up. Follow these steps to complete the Making Tax Digital registration process:

1. Make sure you have your Government Gateway User ID, password and your VAT number ready
2. Go to this link
3. Click “Sign up your business for Making Tax Digital for VAT.”
4. Enter the required information and click Sign In
5. Follow the on-screen prompts and provide any other information that is required. After this, you will be sent a verification e-mail
6. Locate the verification e-mail and verify your e-mail address
7. Read and accept the terms of participation

After following these steps, within 24 hours you should receive confirmation from HMRC indicating whether you can start submitting VAT returns via Making Tax Digital.

Still need help?

If you are still having problems registering or need any advice relating to the process of Making Tax Digital, please feel free to read our article published in March, An Introduction To Making Tax Digital, send us a message or give us a call on 0161 637 1080. We are here to help and make life easier for you and your business.

 

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