As HMRC revealed some intriguing stats today ahead of the rapidly approaching deadline for the first quarterly submission for MTD for VAT, one really stood out like a sore thumb, writes Jenny Strudwick, IRIS' tax specialist.
We were told that nearly 75% of finance sector firms are yet to register for MTD.
Understandably, the message from officials is to get a move on, with the VAT filing date being 7 August.
In contrast, businesses in the agriculture sector (such as farmers) have been one of the fastest groups to sign up, with 50% already registered.
We’re happy to say that of the 400,000 submissions already successfully made using software – another key stat revealed today by HMRC – a significant number were made by IRIS customers using KashFlow and IRIS VAT Filer.
Altogether, more than 600,000 businesses have signed up, with 10,000 registering for MTD every day.
I’m hearing that there’s one clear point causing the biggest trouble for accountants. That’s confusion over the registration process. Many are somewhat baffled by the order things have to be done and how.
I’ve penned an article here that should clear up any uncertainties you may be having. It explains the essential steps to complete the registration process.
Some 1.2 million businesses are affected by the MTD rules (those with an annual turnover above £85,000) and they will be required to submit their first quarterly VAT return to HMRC using software by 7 August.
Officials pointed out today that, if paying by Direct Debit, these businesses must register by Monday 29 July. So, that’s even more urgency for firms to get their skates on.
In today’s announcement, HMRC points out that if paying by Direct Debit, businesses should register at least 7 working days before a return is due. If not paying by Direct Debit, businesses can register at least 72 hours (three days) before their return is due.
Firms will also want to ensure that their last pre-MTD Direct Debit has come out of their bank account before signing up, officials stated in their news release today.
The announcement this afternoon included a quote from Theresa Middleton, Director of MTD at HMRC, re-emphasising that it will be taking a soft landing approach in the early days of MTD implementation.
She said: “During this first year we won’t be issuing filing or record keeping penalties to businesses doing their best to comply.”
As a last reminder, businesses can sign up for MTD on GOV.UK.