If your business currently uses Sage 200 or you are considering implementing Sage 200, the Making Tax Digital policy is an important consideration. The Making Tax Digital Initiative was designed to make the tax returns process simpler and completely online, with different deadlines for different-sized businesses. We take a look at what Making Tax Digital is, how it might affect your business and whether Sage 200 is MTD compliant.
What is Making Tax Digital (MTD)?
Making Tax Digital (MTD) is a part of the government’s strategy to help businesses and individuals enter their tax information and keep on top of their affairs. This wide-reaching policy was designed to make the VAT processing system quicker and more accurate and a number of companies have created new updates to make their software MTD compliant. Announced in April 2019l, it is now a compulsory aspect of the backend service.
Making Tax Digital Deadlines
It’s important that you know the deadline for when your business needs to be fully MTD compliant, but they differ depending on the turnover and size of your business. After the deadline passes you will need to keep digital records and file your returns using MTD compatible software. There are a few different deadlines including:
- Companies who turnover £85,000 or more needed to be compliant by 31st March 2021.
- Businesses turning over less than £85,000 needed to be compliant by 31st March 2022.
- Self-employed individuals and landlords who earn over £10,000 need to be compliant by April 2023.
- There are no current dates for making corporation tax digital.
What are the benefits of MTD?
There are several benefits to the Making Tax Digital initiative, including less room for error, eliminating costly manual processes and the introduction of more ways to import data, such as digital links and emailing CSV files. The policy is designed to make submitting tax returns easier and the process should take less time. Because the returns are submitted quarterly you can gain a more up-to-date picture of your tax bill and potentially fewer audits from HMRC.
Is Sage 200 MTD compliant?
Yes, Sage 200 is compliant with the Making Tax Digital initiative and you can move over to MTD for VAT or submit returns manually via the HMRC portal. Sage has designed a new way to submit your VAT returns directly into the software, reducing the need to enter any information manually.
There are a few extra steps you need to complete during the digital VAT return process but you should only need to do these the first time. If your Sage 200 version is 2017.02 or above, the Making Tax Digital module is already included in the software. If your Sage 200 version is less than 2017.02, you can download and install the Sage MTD Submissions Module online. You will need to enter your VAT registration number and enable VAT submissions, and the module is sold on an annual one off fee, and not available as a subscription.
Want to discuss a Sage 200 project?
Here at Eventura, we eat. sleep and breathe Sage 200. We’ve implemented game-changing Sage 200 solutions for countless businesses and can do the same for you. Our team of expert business analysts, developers, consultants, technicians and support staff can help you identify all of your business requirements, and create a robust business solution that will streamline your operations, increase profitability and accelerate growth.
If yoyu would like to speak with one of our Sage 200 experts, you can request a free call back here.