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Age exemption from MTD for VAT

Age exemption from MTD for VAT - Have any of your clients received theirs?

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Anyone else  got confirmation yet from HMRC that their client can be exempt from MTD  for VAT?  I got my first exemption this morning on the grounds of age.  Took just over 2 weeks. 

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By Kaylee100
22nd May 2019 08:37

Yes, although I was able to add more to it than age. Ours took about a month (I think)

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By MaryandJeff
24th May 2019 10:40

What age qualifies for exemption?

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By The Accountant
24th May 2019 10:54

Just Old. My client is 72 - only 3 years older than me!

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Replying to The Accountant:
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By raju m
24th May 2019 16:26

Would a 65 year old using manual records qualify for MTD exemption?

Raju

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Replying to raju m:
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By Kaylee100
24th May 2019 16:45

Why can he not move to digitalise his records? (like 99% of others are doing). You need to look at why in his particular case.

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Replying to Kaylee100:
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By raju m
25th May 2019 22:15

He has been using manual books for the last 40 years and has not used computers in his life.

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Replying to raju m:
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By Kaylee100
25th May 2019 22:23

So thats a good argument except someone currently files his VAT online so is that you?

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Replying to Kaylee100:
Morph
By kevinringer
27th May 2019 11:01

Correct. I spend minutes filing each VAT return so it is reasonable for me to do this for my clients. In contrast I would have to spend many hours if I had to digitise my clients' records and this would generate a cost and it would not be reasonable for my clients to incur that cost. I include this point in my exemption application letters.

Thanks (1)
Morph
By kevinringer
24th May 2019 10:57

I've had several. But I include more than just age in my exemption application. Other factors I ofetn include are that the taxpayer has never had a computer or smartphone and never used accountancy software or spreadsheets, maybe they live in a broadband not-spot (most of my clients are Welsh farmers -broadband is poor in this part of the world), that the client has maintained their VAT records on paper and they phone the quarterly totals to us and we log into GOV.UK for them and whilst we can offer that service to clients because it only takes 5 minutes a quarter it would be very costly if we had to digitise their records. I often include an estimate of our fees to digitise the records. I may also quote the client's annual profits so HMRC can see what proportion of profits would be consumed to pay us. MTD exemption is based on reasonableness and I put together a case to show that overall on balance it would not be reasonable for my client to comply. So it is not just age, it is everything. I submit my exemption applications in writing. HMRC take about 4 weeks to respond. To date I've submitted exemption applications for a quarter of my clients. To date HMRC have responded to about a third of my applications. To all those responses have granted exemption.

Thanks (4)
Morph
By kevinringer
24th May 2019 10:59

Personally I do not feel age by itself is an issue. I have clients in their 70s who are IT literate. I have clients in their 30s who are not.

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Replying to kevinringer:
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By Kaylee100
24th May 2019 12:38

kevinringer wrote:

Personally I do not feel age by itself is an issue. I have clients in their 70s who are IT literate. I have clients in their 30s who are not.

I concur.

I remember going to see a new client in his 70s about MTD and my plan was to cover exemptions with him. Once I asked the question about how comfortable he was with computers, out came his past history in software coding! He was right up for it, just didnt know how it would work with his current systems.

Age is just a more likely indicator.

Thanks (1)
Bee
By May bee
24th May 2019 11:45

I have just been rejected re a 75 year old client's exemption application; so take that as a warning that just saying your client is 'old' will not be enough to avoid MTD. I am going to appeal as HMRC have ignored the other matters I advised them of which are also significant.

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Replying to May bee:
Morph
By kevinringer
27th May 2019 16:00

I would say age is enough. The legislation says:

•for whom the commissioners are satisfied that it’s not reasonably practicable to make a return using an electronic return system (including any electronic return system that that person is authorised to use) for reasons of disability, age, remoteness of location or any other reason is not required to make a return required by regulation 25 using an electronic return system

Notice it is test, test, test OR test. It says OR not AND. I read it that any one test is enough. For age it simply says 'age' without saying what age is sufficient. I would say 75 is sufficient because if it was not, what age would be. If I had a rejection for a client aged 75 I would point out the legislation and ask HMRC what age would be enough. If HMRC then argued it is a combination of factors I would point out the legislation is clear, it is OR not AND.

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By raju m
24th May 2019 16:21

Would a 65 years old sole trader using manual records at present manage to get MTD exemption because of his age?

Any idea please?

Raju,

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Replying to raju m:
Morph
By kevinringer
25th May 2019 06:58

I have several in this category that I have applied for. I don't think it is enough just to say they are 65 using manual records. Include as many other facts that are relevant eg they don't own a computer or smartphone, that they have never used a computer and so would have to be taught even the most basic of steps such as how to use a mouse, that they will be retiring soon, that currently you efile their manual totals via GOV.UK for which there is a nominal charge but the cost of you digitising their records would be £x000 which would represent x% of their annual profits and that taking all these factors into account it is not reasonable for them to have to comply with MTD. I've heard that HMRC expect family members to help out businesses. I don't think this is reasonable because why should an elderly sole trader have to divulge their business dealings to their children? I've got clients who don't have children and I will state this if relevant. I also state if the client has significant personal commitments which would not give them the time needed to learn how to use a computer eg I have a unmarried client whose elderly disabled mother lives with him and he has to spend many hours caring for her. Include as much info as is relevant as to why it is not reasonable for your client to comply.

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By The Accountant
24th May 2019 17:40

I don't see why not. I think mainly it is all down to how well you (or your client) writes the letter asking for exemption.

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