Hello
Please help me clear up confusion.
According to VAT Notice 700/21: keeping VAT records.
You will need to keep additional records, such as invoices. You do not have to keep these digitally but you may choose to do so. For more information on the additional records that must be kept for VAT purposes
So my clients who are vat registered can continue to keep their records in lever arch files and still be MTD compliant as long as we file the VAT returns using appropriate bridging software? Is that right?
Replies (7)
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Of course not. The information needs to be kept digitally, as per the MTD rules. The MTD rules are in addition to the old record keeping rules, not an optional choice.
Your client can keep invoices etc in lever arch files, but they need to be recorded digitally for MTD purposes.
You need to keep a list of invoices digitally with some automated calculation to the vat return. This can be done with a spreadsheet and bridging software, but there are better ways than that.
In essence you can run Excel sheets with bridging as this is "digital"
No need to scan in all the invoices.
What you cant do is a handwritten book, and type the 4 numbers in, as that's where all the errors lie. Apparently, although HMRC's own research after the failed "Business Records Check" proves this isn't so.
You can carry on keeping the hard copy invoices in the lever arch files, you don't need to scan them. You need to record those invoices on a spreadsheet and use the spreadsheet with the bridging software.