Propman & Making Tax Digital
The vast majority of VAT-registered businesses with a taxable turnover above the VAT threshold (£85,000) will be mandated to keep digital VAT records and send returns using Making Tax Digital-compatible software from April 2019.
Why is MTD being introduced?
Increasingly, businesses see the benefits of digitisation. Millions of businesses are already banking, paying bills and interacting with their customers or suppliers online, and many are already using accounting software.
HMRC’s ambition is to become one of the most digitally advanced tax administrations in the world and MTD is making fundamental changes to the way the tax system works – transforming tax administration so that it is more effective, more efficient and easier for taxpayers to get their tax right.
The move to digital integration will eliminate many of the existing paper-based processes, allowing businesses and their agents to devote more time and attention to maximising business opportunities, encouraging growth and fostering good financial planning.
When does it come into force?
Pilot schemes have already been in place since April 2018 as a way of testing the system.
The VAT scheme will become mandatory on 1 April 2019, as VAT-registered businesses with a taxable turnover above the VAT threshold (£85,000) are mandated to keep digital VAT records and send returns using MTD-compatible software.
For a small minority of VAT-registered businesses (around 3.5% of mandated customers) with more complex requirements, HMRC have made the decision to defer mandation by 6 months to ensure sufficient time for testing the service with them in the pilot before they are mandated to join.
How can I prepare?
You must start keeping your business records digitally before you can sign up for MTD. If you already use software to keep your business records, check with your software provider what their plans are. If you don’t use software just now, or your software won’t be MTD-compatible then you’ll need to consider what software, or bridging software, is most suitable for you.
What affect does this have on Propman?
As mentioned above, a fundamental part of MTD for VAT is the use of
We’re committed to making sure Propman meets our users MTD business needs and our Business Analysts have been working on MTD for some time, determining the required functional changes to Propman based on the information provided by HMRC. The new MTD functionality is available via our X4.05 update.
What new functionality will be released?
New functionality will include changes to VAT Reporting Groups, VAT Reports, VAT Adjustments, VAT Exports and Conversion.
We’ve created a user guide which details these changes in more detail. If you’re a Propman user you can request a copy by emailing firstname.lastname@example.org
However, if you’re not a Propman user but you’d like to find out more about Propman and our MTD functionality, request a demo here.
How do I get the new MTD functionality?
The new MTD functionality is included in the Propman X4.05 update which we’re now scheduling upgrades for.
If you’re a Propman user and you’d like more information on upgrading please email email@example.com.