Author Topic: Mandatory Period (post April 1 2019) and Sanctions  (Read 317 times)

johnhemming

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Mandatory Period (post April 1 2019) and Sanctions
« on: 10 October, 2018, 12:31:30 PM »
During the Mandatory period businesses will need to sign up to MTD, but only if they have a turnover in excess of the registration requirement (currently £85,000).

Obviously HMRC will not know whether or not a business is turning over that much until any VAT returns have been submitted.  An important point about this is that businesses will have to start keeping electronic records at the start of the VAT period (quarter or month), not just when they sign up for MTD.

Hence any business that is marginal as to whether they are turning over more than 85,000 should be careful not to find that they need to keep electronic records that they have not kept.

There will be sanctions for businesses that do not convert to MTD, but they are likely to be based around a points regime whereby the sanctions do not necessarily occur immediately, but only after a number of failures.  Hence if, for example, a business does not convert for the first quarter they may not be fined and will be able to use the old website for submitting the VAT return (which should be done on time).  However, they run the risk of being fined at some stage if they simply ignore the need to change.

Our recommendation is to simply get on with it and ideally that businesses should participate in the pilot scheme where possible.