HMRC has announced that penalties will be issued to those not completing VAT returns through Making Tax Digital (MTD) from 1 November 2022.
Anyone who files a VAT return via a non-electric submission will face penalties of up to £400.
These changes will apply to VAT customers for accounting periods on or after 1 April 2022.
The amount businesses will be fined for not submitting the VAT return through functional compatible software will depend on their annual turnover:
● £100 if turnover is below £100,000;
● £200 if turnover is between £100,000 and £5,600,000 inclusive;
● £300 if turnover is between £5,600,001 and £22,800,000 inclusive; and
● £400 if turnover is £22,800,001 or above.
Between £5 and £15 will be charged per day if businesses do not keep the records required of them digitally in the appropriate software.
The same goes for every day the business does not use digital links to transfer or exchange the required data between software when multiple pieces of software are used.
Up to 100% of the VAT owed can also be charged as a result of making a mistake by failing to use ‘checking functions’ in the software.
Speak to us about Making Tax Digital.
