The UK’s Making Tax Digital programme came into effect in 2019. MTD mandates that firms must keep digital records and submit their VAT returns electronically. The UK government has since implemented the more extensive MTD Phase 2. MTD2 has more rigorous digital compliance requirements. (You can read more about how MTD affects your business in the Vatglobal resource library.)
Of course, MTD is not simply about creating new laws for VAT compliance. The UK’s electronic VAT filing programme is supposed to reduce errors and ultimately make it easier for businesses to meet their VAT compliance obligations.
And, at least according to a new UK government overview, MTD is showing signs of success.
Making Tax Digital (and faster)
The government’s ‘Impact of Making Tax Digital for VAT’ report says that 67% of businesses believe MTD has reduced the potential for errors when filing VAT returns.
More than half of UK businesses surveyed said that electronic VAT compliance has made submitting returns faster. And 53% said they are more confident that their VAT returns are accurate.
Your MTD technology matters
When do the benefits of MTD outweigh the costs? The report reveals something important. Businesses using software fully compatible with MTD were much more likely to find the benefits outweigh the costs than companies using bridging software. SImilarly, businesses using fully compatible software found that MTD reduced the time they spent on record keeping and VAT submissions. By contrast, businesses that did not use fully compatible software were less likely to have reduced the time spent managing their VAT.
Speak to the VAT technology specialists
Vatglobal’s proprietary VAT compliance technology was designed to make meeting your VAT compliance obligations simpler, faster and easier. Our suite of digital tools lets you manage the whole compliance process with minimal fuss. It’s a more effective way to meet your MTD obligations.
Plus our expert VAT team is always on hand to provide VAT advice and assistance. Get in touch with Vatglobal to make MTD work for you.