Kerridge CS is pleased to provide MTD compliant software. Here is why K8 is the perfect solution for your business.
An Insight into Making Tax Digital and the Software You Need
Her Majesty’s Revenue and Customs (HMRC) has an aim to become one of the most digitally advanced tax administrations in the world. Through the government’s upcoming initiative, Making Tax Digital for VAT (MTD), for businesses registered for VAT with a taxable turnover above the threshold of £85,000, it will be a requirement to keep records digitally and submit their VAT Return using compatible software.
To ensure that these businesses are able to adapt to the new legislative requirements to submit their financial information electronically businesses are required to use functionally compatible software to meet the new VAT conditions. We can confirm that HMRC has placed Kerridge Commercial Systems (KCS) on its list of software suppliers supporting Making Tax Digital for VAT. KCS’ latest K8 software is compliant with the new regulation set out by HMRC. Businesses can now submit their VAT Returns directly from the K8 software application; this allows for VAT details to be submitted via the HMRC published API, ensuring that filing a VAT Return is easy.
In this blog post, we take a closer look at what MTD means for your business, its implementation, and how you can prepare in advance.
Making Tax Digital: The View on VAT for Applicable Businesses
To ensure that businesses are prepared, over half a million companies across the UK have become involved with HMRC’s pilot for its updated VAT online services and have been testing since October 2018 – making key recommendations before its wider release.
As a result, the forthcoming change is set to transform the current tax system for the better. Although Making Tax Digital will only cover VAT to start with, HMRC announced that other taxes would be mandated from 2020 at the earliest.
It’s expected that these plans will make it easier for businesses to get their tax right and keep on top of their own financial affairs. As a result, the government will be able to reduce taxation errors and mistakes, which cost around £9 billion every year.
At its core, MTD will simplify VAT reporting and record keeping for businesses. It’s the submission of financial information to HMRC through digital means, with the ability to keep track of all transactions that have taken place, such as sales and purchase invoices.
Businesses with a taxable turnover above the VAT registration threshold are obligated to adopt this new change within their own company. But businesses that have voluntarily registered for VAT will not have to comply right now — but can do if they want to. If you’re a growing business or want to submit your financial information smoothly with no mistakes, considering the software as early as possible is recommended. Alternatively, those with a turnover beneath £85,000 can continue to calculate their VAT Return figures on a spreadsheet and type them in to VAT online services.
Businesses that may be exempt of MTD are as follows:
- If a taxable turnover in the 12 month period prior was beneath the VAT registration threshold
- Conflicting with religious beliefs
- Remoteness of operations — lack of internet connection
K8: Compatible Software
In essence, K8 gives your business complete and accurate visibility of all operations. It is a fully integrated business management solution, with an integrated financial suite at its core. You can now prepare the VAT Return from the digital records within K8 and submit them electronically to HMRC’s systems through their API.
We want to create a seamless experience for your business. By using K8 , you’ll be able to meet HMRC’s standards. With this software, you can retain records in a digital form and preserve them for up to six years.
In preparation for its implementation, our consultancy teams have been fully trained to ensure that they can give you the right advice and guidance to help you make the right decision. To help you understand how to use the software effectively, we will also be producing in-depth video tutorials so that you can familiarise yourself with the product, helping you save costs on any additional training that may be required.
You can’t afford to stay on the line when it comes to Making Tax Digital, so make sure that you have compatible software in place before 1st April 2019.
Contact our team of experts online today to find out more information about Making Tax Digital and how K8 can help.