This is just to remind anyone who is registered for VAT voluntarily and whose annual turnover is less than the £85,000 threshold, that HMRC’s Government Gateway Portal, in other words, the way in which VAT returns have been filed for a number of years, will close with effect from 7th November.
This means that any VAT returns for periods after 30 September can no longer be filed in this way and you will have to register for Making Tax Digital (MTD).
For those to whom this is applicable, please read on as we are producing the email sent by HMRC to traders in that position who they call “customers”. If this is applicable to you and you do not know how to proceed, please do not hesitate to contact us so that we can make sure you remain compliant.
We previously let you know that from Tuesday 1 November 2022 your clients will no longer be able to use their existing VAT online account to file their monthly or quarterly VAT returns.
That’s because by law, all VAT-registered businesses must now sign up to Making Tax Digital (MTD) and use MTD-compatible software to keep their VAT records and file their VAT returns.
If your clients do not sign up for MTD and file their VAT returns through MTD-compatible software, they may have to pay a penalty. The best way for businesses to avoid penalties is to start using MTD now.
What businesses need to do now, or they could face a penalty
If your clients haven’t signed up to MTD and started using compatible software already, they must follow these steps now:
Step 1. Choose MTD-compatible software that’s right for them – you can find a list of software, including free options, on GOV.UK.
Step 2. Check the permissions in their software – once they’ve allowed it to work with MTD, they can file their return easily. Go to GOV.UK and search ‘manage permissions for tax software’ for information on how your clients should do this.
Step 3. Keep digital records for their current and future VAT returns – you can find out what records they need to keep on GOV.UK.
Step 4. Sign up for MTD and file their future VAT returns using your MTD-compatible software – to find out how to do this, go to GOV.UK and search ‘record VAT’.
If your clients are already signed up to MTD, no further action is required.
Information for businesses due to file by 7 November 2022
If your client’s turnover is under the VAT threshold of £85,000 and they haven’t signed up to MTD in time to file their next return by 7 November 2022, they can still use their existing VAT online account for that return only.
However, they must complete the steps above in order to file any returns due after 1 December 2022 if they file monthly or quarterly VAT returns, or they could face a penalty.
We’ll be contacting these businesses directly to let them know.
Businesses that file annual VAT returns will still be able to use their VAT online account until 15 May 2023.
How to apply for an exemption from using MTD-compatible software
If your client is already exempt from filing VAT returns online or if they or their business are subject to an insolvency procedure, they’re automatically exempt from MTD.
You can check if they can apply for an exemption on GOV.UK. HMRC will consider each application on a case-by-case basis.
Help and support available
You can find more information on how to support your clients on GOV.UK, including a step-by-step guide to signing up for MTD on your clients’ behalf.
You can signpost your clients to help and support for MTD on GOV.UK, where they can find useful videos, register for live webinars and see the latest guidance and updates on MTD for VAT.
Protect yourself and your client’s information
You should never ask for or use your client’s HMRC sign in details to access their tax account.
If you need to access your client’s information, then you should obtain the correct authorisation from your client and use HMRC’s agent digital services.
If you cannot get your client’s information using agent digital services, then we recommend asking your client to sign into their Personal Tax Account and provide the information or contact HMRC.
If someone contacts you or your client saying they’re from HMRC and wants you to transfer money urgently or give personal information, never let yourself be rushed. Take your time and check HMRC’s advice about scams on GOV.UK.”