It’s been almost two years since HMRC introduced the first phase of Making Tax Digital (MTD) for VAT businesses. Xero has been working hard to ensure they have the right solutions as Making Tax Digital expands ...
HMRC recently announced that non-MTD VAT submissions via software providers will not be supported from April 2021. This means that quarterly VAT periods ending in December 2020, January 2021 or February 2021 will be the last VAT returns you can submit using the old VAT return in Xero.
To prepare for this change, you have two options:
- Get registered for Making Tax Digital for VAT with HMRC and use MTD VAT in Xero before they are mandated to from April 2022
- If you're not yet ready for MTD, such as those under the threshold or part of a VAT Group, you can generate the VAT amounts using the new non-MTD VAT return in Xero. Please note that you will be required to submit the return manually using HMRC online services, or by using MTD bridging software
The new non-MTD VAT return in Xero will be available from 23 November 2020 and is ideal if you aren't quite ready to make the move to Making Tax Digital in full.
It will also be the only non-MTD VAT return option in Xero for trials and subscriptions in future.
If anything I've written here resonates with you, call me on 01604 420057 and let's see how we can help you.