MTD (Making Tax Digital)

Or otherwise known as ‘Making Tax Difficult’.

MTD comes into effect as of April 2019.  In HMRC’s recently published VAT Notice 700/22 Making Tax Digital for VAT it has become apparent that once registered for MTD companies are always registered for MTD even when they de-register from VAT.

In the Stakeholders communication pack clarity is found to the question: ‘What if my taxable VAT turnover is below the threshold?’ The answer states: ‘Businesses already have to check their turnover for the last 12 months at the end of each month so see if it exceeds the VAT threshold.  If it does then MTD applies from the first day of the following month.’

So as long as a business has sales of less than £85,000 for the 12 month period ending 31 March 2019 and every rolling 12 month period thereafter, they have no MTD worries.

The bad news is that is a VAT-registered business goes over the £85,000 threshold in any rolling 12 month period after April 2019, even if only temporarily, then it must join MTD and cannot withdraw if turnover subsequently falls below the threshold.  So once you are in, you have to stay.

Contact us at info@bennewith.co.uk is you need more assistance, or advice, with regards to MTD.

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