What’s next? Reviewing Self-Assessment season and Making Tax Digital for VAT for 2021

15th Mar 2021
Brought to you by
Share this content

We’re taking a look back at the extended Self-Assessment season and forward to March 31st when the Making Tax Digital for VAT soft-landing period ends. Catch up on recent developments for Income Tax and VAT, and learn how the right tools can make practice life easier for accountants.

Reviewing Self-Assessment season and Making Tax Digital for VAT for 2021

Reviewing Self-Assessment season

With just 6 days until the January 31st Self-Assessment tax deadline, HMRC responded to pressure from accountants and their professional bodies by announcing an extension. It meant that accountants had an extra month to corral their clients before any penalties were imposed. On one hand, this extension relieved some of the end-of-season burdens for practices that have many Self-Employed clients impacted by the pandemic. But it also meant an extra month of hard work and long hours while working from home and imagining the skiing holiday that wasn’t possible this year.

As HMRC estimated that 3.2 million people had yet to file at the time of announcing the extension on 25th January, their Chief Executive, Jim Harra, said:

“Not charging late filing penalties for late online tax returns submitted in February will give them the breathing space they need to complete and file their returns, without worrying about receiving a penalty.”

Self-Employment Income Support Scheme – as it stands

Although the SEISS fourth-round grant was public knowledge ahead of 3rd March, Chancellor Rishi Sunak used his Budget statement to confirm that the Self-Employment Income Support Scheme (SEISS) grant was to be extended until September 2021 with the inclusion of a fifth and final grant.

What’s next for Self-Assessment?

With the confirmation that the fourth grant will pull those who filed income tax returns for the first time for 2020/21 into its coverage, there will be plenty of work for accountants when it comes to supporting their clients before January rolls around again. We also learned that the fifth grant will be paid inline with the impact of Coronavirus lockdowns, although the government is yet to announce how that impact will be assessed.

And as the Making Tax Digital for Income Tax Self-Assessment pilot rolls into its second year, it remains to be seen if those receiving grants under the SEISS will be able to join ahead of next year’s January 31st deadline.

What is certain is that UK accountants will continue to be called upon by their Self-Employed clients for the additional support and guidance they can provide. That’s where comprehensive tax software can make a big difference.

Recently released updates for BTCSoftware’s modules included a bevvy of changes including major Self-Assessment product updates for 2021 Individual, Partnership and Trust Tax Returns, plus R40 Claims for Repayment of Tax. Our development team worked persistently post-Budget 2021 to ensure that our customers have the most accurate rates and information ready to help their clients throughout the rest of this year, and we’re delighted to bring you this update so quickly.

These updates, in combination with a comprehensive selection of client reports, will provide our customers with the tools they need to make sure that they can support their clients effectively and efficiently.

Reviewing Making Tax Digital for VAT

The Making Tax Digital for VAT journey so far has been well covered by BTCSoftware and other leading tax writers. From a shaky start to confusion over bridging software and Excel record keeping, and higher than expected costs to getting started for many, our mission at BTCSoftware has been to demystify the process and create cost-saving comprehensive software to help accountants and businesses comply easily with digital VAT rules.

What’s next for MTD for VAT?

The end of the soft-landing period is coming up fast. Despite an extension of 12 months, the pandemic has meant that many businesses are unclear on how the rules change from 1st April 2021.

After the soft-landing period ends, HMRC will no longer accept copy and paste or cut and paste as a valid method of filling in the VAT return. Digital records may be kept using bookkeeping software or in a spreadsheet, then linked digitally using import software before digital submission to HMRC.  

Bridging software to link spreadsheet records to HMRC for VAT returns will remain compliant as a Making Tax Digital for VAT option. It’s a cost-effective choice, with the added benefit to accountants of providing options to your clients, rather than working to migrate everyone onto a single bookkeeping software choice.

Self-Assessment and VAT made simple with BTCSoftware

Self-Assessment software

The intuitive layout of our Self-Assessment tax software provides HMRC guidance notes within the context of your current task. Individual Tax Returns feature our pre-submission validation tools to avoid errors before you submit the SA100 forms to HMRC online.

For Trust and Partnership Tax Returns, our add-ons for our ITR software provides fantastic value for money and enhanced efficiency for anyone who needs to submit these returns to HMRC.

Financial data is drawn from Accounts Production or easily input, and client data pre-populates from Practice Management Core to speed up your tax work and administrative errors. Plus, our built-in reports make it simple to understand and analyse your Self-Assessment activities and commitments.

Making Tax Digital for VAT

BTCHub supports filing for multiple VAT registrations and VAT Groups. This SaaS Making Tax Digital for VAT solution is updated in line with HMRC releases and features links with Sage, QuickBooks, CSV and Excel. It’s easy to use the Excel add-in to import figures directly from spreadsheets to BTCHub with seamless digital links.

Plus, multiple unique user logins and a central VAT dashboard enhance the software for use by teams supporting multiple businesses or clients.  

Want to learn more?

We have much more information available to you on our website.

The best way to see what BTCSoftware can offer you is by giving us a call on 0345 241 5030. We’ll be able to answer your questions, and if you like the sound of cost-effective, time-saving practice, tax and accounts software then we’ll be happy to book a free demo.