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MTD deferral

MTD deferral

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I have a client who insists on doing their own VAT (much to my disapproval). They're planning to wind down their business next year, and have done nothing to date to prepare themselves for MTD (they keep records on a piece of paper!). They've contacted HMRC and HMRC have apparently agreed to consider granting a deferral for MTD (decision to be made within 30 days). I didn't realise this was an option. Did anyone else??

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By Duggimon
27th Jun 2019 10:19

When are they looking at winding it down? If I had a client who was winding down before 1 April 2020 I'd probably have advised them to ignore MTD.

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By whatdoyoumeanwashe
27th Jun 2019 13:44

Can you ignore it and carry on with the old filing system without causing yourself problems?

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By Duggimon
27th Jun 2019 14:49

You're contravening the regulations, and technically HMRC could fine you for not even trying to comply, but in practice April 2020 is likely the earliest anyone is going to get penalised for failing to comply.

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By whatdoyoumeanwashe
27th Jun 2019 15:46

So you don't think the old filing system will actually cease working? I guess not given some entities have a valid deferral.
(To be clear, I'm not contravening the regulations, it's be my client, since I'm not their VAT agent!)

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By Duggimon
27th Jun 2019 15:57

Not everyone who is VAT registered has to use MTD, the old system will stay online at least until that stops being the case.

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By ColinNibbs
30th Jun 2019 10:20

I have been told that if you have not started the MTD registration for yourself as agent, then you can continue to file under the old system. This is due to the lengthy delays in getting AML compliance.

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PJ
By paulgrca.net
27th Jun 2019 12:43

''I have a client who insists on doing their own VAT (much to my disapproval). ''

Why do you disapprove!

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By whatdoyoumeanwashe
27th Jun 2019 13:45

Because they get it wrong and I have to work out their VAT corrections at the end of each year for them! And because it's an excuse to create their records retrospectively.

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PJ
By paulgrca.net
28th Jun 2019 12:57

Nothing wrong with clients preparing their own VAT returns some get it right others make mistakes that has always been the case. What do you mean when you say its an excuse to create their records retrospectively?

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RLI
By lionofludesch
27th Jun 2019 17:05

The fact that they're winding the business down, presumably with an intention to retire, seems good cause for not investing in software.

I would have been confident in applying for that one.

If you don't approve of his records, you don't have to accept his instructions, you know. Just saying, like.

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By petersaxton
30th Jun 2019 09:31

The "investment" in software isn't very onerous. The real issue is learning to use the software properly - given they don't seem to understand VAT well enough to prepare their own VAT returns.

But I suppose HMRC still think it's just a question of pressing one button. Maybe if one button is pressed every quarter then HMRC wont issue any penalties in the future?

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