Introduction to MTD for VAT
The changes to VAT, for a VAT registered business with a turnover above the VAT threshold, is mandatory.
These changes take effect from 1st April 2019 and will require: –
- Businesses must keep their VAT records digitally.
- Businesses must send HMRC the VAT return through MTD compatible software.
Record your Income electronically
You can use the Rhino Small Business App to create invoices and credit notes. Alternatively, you can continue to use products like Microsoft Word to create the Invoice Document but you will need to record the transaction in Rhino and attached the Microsoft Word File to the Invoice.
If you manage a business like a restaurant that has a high volume of transactions, you can record a Receipt and attach a file containing a list of the detailed sales transactions.
Record your Expenditure Electronically
You can use the Rhino Small Business App to record your Expense transactions. Using the App on your phone to take a photo of the Expense Receipts means that you no longer need to retain paper copies of the Receipts.
The MTD Vat Submission Process
Once you have recorded your transactions, you will need to do the following: –
- Connect to the New MTD Platform (Authentication Process)
Connecting the Rhino Small Business App to the MTD platform is a one-off exercise and it takes approximately one minute to complete. This process grants the Rhino Small Business App the permission to update the MTD platform on your behalf thereby avoiding the need to log the HMRC Web Site.
- Provide Periodic Updates
Each time you go into the VAT Submission Process, the Rhino App will take a few seconds to download the latest set of ‘VAT Obligation Dates’ that have been made available by HMRC.
- Submitting your Data to HMRC
Rhino will summarise the Income and Expense Data on a screen similar to the 9-Box VAT form that you will be familiar with. You will have the opportunity to make adjustments and record notes before completing the submission process. Note that in the event you need to make a high volume of adjustment, you can attach a spreadsheet which will be attached to the Rhino Submission Process.
Once submitted, the detailed transactions recorded in Rhino that are linked to a Submission are locked. This lock maintains an audit connecting the detailed transaction to the summary data that you submitted.
You will have the flexibility to enter new Invoice and Expense transactions for a period that you have already submitted.