How do we decide whether clients fall within MTD?

How do we decide whether clients fall within MTD?

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From Peter Saxton

 

So we know that self employed and landlords above a turnover of VAT registration threshold will have to comply with MTD from April 2018.

What period do we use to decide whether a client is over the threshold?

2017-2018 - I can't see it being that as the accounts may not be available

2016-2017 - that will be possible

I've not seen any decisions from HMRC.

When we get to April 2020 for limited companies it would be difficult to justify 2018-2019 as the tax returns wouldn't be due until 31/03/2020 if the year end was 31 March.

Whatever is the rule it would make sense that accountants and their clients have a year or two to prepare rather than being rushed into online bookkeeping. This is especially true for clients who need to comply with MTD with turnover over £10k.

Replies (6)

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RLI
By lionofludesch
24th Mar 2017 12:28

Do you need accounts to decide the turnover ?

We don't do that for VAT registration. We monitor sales on a monthly basis.

But the answer to your question - as in so many other MTD questions - is we don't know.

Thanks (1)
Replying to lionofludesch:
By petersaxton
24th Mar 2017 12:39

I agree that you don't usually and you do have a point. I wouldn't be 100% certain on turnover until I had looked at all the transactions - there's always something that could affect the turnover figure even if it's not a sales invoice or credit note. Clients are notoriously unreliable!

Thanks (0)
Replying to petersaxton:
RLI
By lionofludesch
24th Mar 2017 12:44

True. But it's only going to apply near the cusp, isn't it ?

You're not going to bother about whether a business with a turnover of £2m has forgotten to jot down a few own goods.

90% of cases will be clear one way or the other.

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By youngloch
24th Mar 2017 12:49

I read somewhere that on borderline cases HMRC won't be too fussed if MTD starts a year late.

I'm reading from that that if we finish the 2017 return and the client is over then they're in and if we then discover when doing the 2018 return that they should have been but weren't then it's just a case of getting them in from 2019.

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By Southwestbeancounter
24th Mar 2017 18:04

Surely there's so much still 'up in the air' about MTD, especially now The Lords are getting involved, that is it really worth too much effort being put in now as it might all change by the time we get there or am I just hoping that it won't be brought in under its current guise and did I really ought to start worrying now?

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RLI
By lionofludesch
24th Mar 2017 18:12

Apart from HMRC - has anyone actually said this plan is a good one ?

Even the software companies must feel that they're struggling to meet deadlines.

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