The VAT notice for MTD has been updated and includes some new information and rules.
Making Tax Digital (MTD) is mandatory for non-deferred businesses above the VAT threshold for VAT return periods commencing on or after 1 April 2019 and VAT Notice 700/22 contains most of the practical guidance businesses need to comply with the new rules. This notice has been updated and includes new information/rules on the use of supplier statements, petty cash transactions and charity fundraising events. The guidance on the turnover test, following the rules when exempt from MTD, digital links, and supplies made and received by third party agents has also been updated.
There is new content in the Notice covering the following areas:
In relation to the sections that have been updated, of most note in section 4.2.1 Digital links, the following paragraph has been added:
“This could be a transfer or exchange of data within a business (for example, between 2 systems) or a transfer of data to a tax agent in order that they can prepare a VAT Return or make a calculation (for example, a Partial Exemption calculation).”
These new provisions are practical and designed to reduce the work involved in complying with MTD, making compliance easier and more straightforward, and as such will be welcomed by businesses. If you have any questions on these changes or MTD more generally, please speak to your usual contact.
For further information please contact:
© 2020 KPMG LLP a UK limited liability partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organisation please visit https://home.kpmg/governance.