One month to go until launch of Making Tax Digital for VAT

The government is encouraging businesses to sign up for Making Tax Digital (MTD) as today (March 1) marks one month until the new HMRC initiative is introduced.

From April 1, businesses above the VAT threshold will need to keep digital records and submit tax returns using MTD-compatible software.

The new service is designed to reduce the time spent on administration and provide an integrated approach to business and tax, with over 160 types of software products available to suit different functions and budgets.

According to government figures, almost 1.2m businesses have yet to register for the service, with approximately 30,000 businesses already signed up ahead of the launch.

Mel Stride, financial secretary to the Treasury, said: “It has never been more important for businesses to be able to seize the opportunities that digital technology offers. Making Tax Digital helps them to do just that.

“It will give businesses more control over their finances, allowing them to spend time focusing on innovation, growth and the creation of jobs.”