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A guide to Making Tax Digital?

Posted: March 16th, 2022, 3:06 pm
by bungeejumper
I'm currently winding down my one-man business as I move into retirement - there are whole quarters these days where I don't have any turnover at all. But I'm still VAT registered, as I have been for 35 years, because it still brings in a few quid. I'm currently claiming VAT inputs for my domain and my related internet expenses, plus accountancy and a few specialised inputs, and an apportioned part of my phone bill, but not very much else. In due course, I expect I'll stop the whole VAT thing and deregister. :|

Unfortunately, HMRC isn't prepared to wait that long. From next month, I'm required to sign up for Making Tax Digital, and get myself an HMRC-approved program suite and learn how to use it, and then make all my future VAT returns through it. And I really haven't a clue where to start. :? I suspect that I'm not going to be the only baffled small trader!

Up till now, I've kept my quarterly accounts on a simple spreadsheet which I wrote myself, and every three months I've manually plugged the numbers into the traditional online VAT form, and then at the end of the year my accountant has totted it all up and everybody's been happy. If it ain't broke don't fix it. Huh, I should be so lucky.

So okay, I need a crash course in running this thing, and then some approved software, ideally free or pretty cheap. The HMRC page at https://www.tax.service.gov.uk/making-t ... l-software has a list of approved suppliers, but no clues as to how easy they are to use. (Ideally, very.)

Any recommendations for a solo septuagenarian simpleton?

BJ

Re: A guide to Making Tax Digital?

Posted: March 16th, 2022, 3:25 pm
by pje16
Hi BJ
check this post
viewtopic.php?f=49&t=33605&p=486702#p486702
As you have your own records
have a look at the video on that site
cheers
Paul

Re: A guide to Making Tax Digital?

Posted: March 16th, 2022, 4:01 pm
by Lootman
bungeejumper wrote: From next month, I'm required to sign up for Making Tax Digital, and get myself an HMRC-approved program suite and learn how to use it, and then make all my future VAT returns through it. And I really haven't a clue where to start. :? I suspect that I'm not going to be the only baffled small trader!

I assume this mandatory requirement is only for small businesses, specifically for VAT?

HMRC surely could not impose that requirement on individual taxpayers for income tax returns? Could they?

Re: A guide to Making Tax Digital?

Posted: March 16th, 2022, 4:10 pm
by pje16
Yes it's for business
and it deals with VAT
It's not for personal tax
that has recently been pushed back until 2024
That other thread started for individuals on a pilot scheme
but I don't think HMRC are anywhwere near ready yet

I started by mentioning the business, and off it went it's own :lol:

Re: A guide to Making Tax Digital?

Posted: March 16th, 2022, 4:14 pm
by bluedonkey
I suggest de-registering and avoid the hassle.

Re: A guide to Making Tax Digital?

Posted: March 16th, 2022, 4:28 pm
by pje16
not if his inputs are greater than outputs
It's not THAT much hassle

Re: A guide to Making Tax Digital?

Posted: March 16th, 2022, 4:50 pm
by bungeejumper
pje16 wrote:not if his inputs are greater than outputs
It's not THAT much hassle

Well so far it's a hassle. :lol: I've just tried setting up a Quickfile account, and it's taken me straight into territory where my usual VAT returns don't go. And it doesn't seem to like the fact that I'm on accrual accounting, not cashflow accounting. (I never did get round to making the switch, but it's never caused any problems till now.)

Too many confusions to list here really, but it just doesn't do things the way I do. :| For instance, I've told it how much money I'm owed by creditors (some of them very long-standing), and it now seems to be forcing me to create new invoices for the whole total amounts, just for my own records, and then send them out. They're gonna absolutely love that. ;)

One key difference is that Quickfile seems to want to tangle with the inner workings of my personal bank account, which are normally dealt with once a year by my accountant when he does my self-assessment form. Indeed, it looks to me as though Quickfile is an integrated accounts package with a VAT reporting facility on the side! Are they all like that?

Maybe they are? If so, I've got a lot to learn. And I'm a supposedly intelligent human being with a couple of books on finance and economics under my belt. If I can't fathom this new system, what hope has my plumber got?

BJ

Re: A guide to Making Tax Digital?

Posted: March 16th, 2022, 4:55 pm
by pje16
This is the I used with my friend
https://www.comsci.co.uk/100PcVatFreeBridge.html
very easy
It just deals with the VAT return, not invoicing or anything else

Re: A guide to Making Tax Digital?

Posted: March 16th, 2022, 5:00 pm
by bungeejumper
pje16 wrote:This is the I used with my friend
https://www.comsci.co.uk/100PcVatFreeBridge.html
very easy
It just deals with the VAT return, not invoicing or anything else

Cheers, pje, that looks more like what I'm after. :) Will give it a go tomorrow, when my poor fried brain has had time to recover. :evil:

BJ

Re: A guide to Making Tax Digital?

Posted: March 16th, 2022, 5:04 pm
by pje16
If you get stuck drop me PM and I'll see if I can help
but I don't have it installed my mate does, I am going to see him once he has put his March figures in
We downloaded the excel examples from the site and watched the video

Re: A guide to Making Tax Digital?

Posted: March 21st, 2022, 2:12 pm
by PaulBullet
https://vitaltax.uk/

we use this for bridging between excel and HMRC

watch video's and it should easily work for you

Paul

Re: A guide to Making Tax Digital?

Posted: March 23rd, 2022, 4:00 pm
by bungeejumper
PaulBullet wrote:https://vitaltax.uk/

we use this for bridging between excel and HMRC

Looks promising. Thanks Paul!

At the risk of repeating myself, there is no way that I can see all the millions of small-time VAT-registered businesses in the country** getting their quarterly returns into an MTD format during the next 36 days. Some of them are in cash businesses, some do all their record-keeping with a notebook and pencil, and some can't cope with numbers at all and leave everything to their accountants at year-end. Some people can't handle a computer at all, of course. This is going to get messy! :?

BJ

** Apparently there are 3 million small and medium sized VAT-registered businesses in the UK, of which 2.25 million are sole proprietorships, and a hell of a lot of those will be sole traders. Hmmmmmm. :|

Re: A guide to Making Tax Digital?

Posted: April 5th, 2022, 9:58 am
by ClaudiusTheIdiot
Thank you bungeejumper for the question and to all those who answered. I suspect like many others I use a simple spreadsheet (in this case Excel 2000) so thought I was in for problems. I installed 100PcVatFreeBridge and used it for the first time yesterday. The instructions were clear and ...it just worked, no hassle. A small donation is all that is asked.

I still don't see the point of this MTD exercise for small businesses. In fact a pox on successive governments for continually burdening us with more complex and more obscure tax collection systems (does anyone actually know how many allowances/bands/exemptions there are in the income tax/NI/social care tax system?) - a huge waste of productive people's time and effort [slinks back into cage...]

Re: A guide to Making Tax Digital?

Posted: April 5th, 2022, 10:03 am
by pje16
Thanks @ClaudiusTheIdiot
Good to know that 100PcVatFreeBridge worked ok as that is what I will be using to help my mate when he calls me

Re: A guide to Making Tax Digital?

Posted: May 18th, 2022, 3:12 pm
by bungeejumper
ClaudiusTheIdiot wrote:Thank you bungeejumper for the question and to all those who answered. I suspect like many others I use a simple spreadsheet (in this case Excel 2000) so thought I was in for problems. I installed 100PcVatFreeBridge and used it for the first time yesterday. The instructions were clear and ...it just worked, no hassle. A small donation is all that is asked.

Well done, Claudius, I wish I'd found it as easy as you! I've been battling with 100PcVatFreeBridge today, and unfortunately it's been an uphill struggle all the way. But I think I've finally cracked it now. Won't know for sure till the next time I submit a VAT return in August :?

Okay, I have finally managed to get all my Excel link names set up, and 100PcVatFreeBridge is now reading the right numbers from my spreadsheet. The "Select Data Source" window shows a full set of correct numbers. But I thought I was in trouble when I hit Save and the Grant VAT MTD Authority screen came up, and I just got a blank screen. And a transaction log that said:
Grant Authority
VAT authority needed (expired or never obtained). Performing grant authority procedure.
Failed to get VAT Authority!

And that's as far as I was getting. Why weren't they getting VAT authority? Because I was an idiot, that's why. :|

If I'd looked at the small print on the HMRC site (as you do...... :lol: ), I'd have seen that I needed to action the MTD process from inside my existing VAT account. Just getting an MTD bridge and trying to use it wouldn't ever have got me through the iron gates. Dammit, until I'd personally pre-approved the MTD connection, the bridge software wasn't even allowed to mention my VAT number!

Iron gates indeed. And with locks on either side. Fair enough. But it looks as though HMRC might be backing down a bit on the MTD deadline. Having previously told me that I wouldn't be able to make any more VAT returns through the traditional online process, the system unexpectedly accepted my online return for February to April without a murmur. 8-) Could it be that the (often incomprehensible) MTD take-up has been falling behind schedule? I wonder?

BJ

Re: A guide to Making Tax Digital?

Posted: May 26th, 2022, 3:58 pm
by brightncheerful
At the risk of repeating myself, there is no way that I can see all the millions of small-time VAT-registered businesses in the country** getting their quarterly returns into an MTD format during the next 36 days.


i shall have to get to grips with it, my quarterly return next is 31 May. Usually I submit my return within a day or so after but I suspect it'll be longer this time, despite being on Xero. https://www.xero.com/uk/. Xero offers a 30 day free trial meaning you could use it for your return and then de-register.

(My business has been registered for VAT since 1975 about 1 year after VAT was introduced)

Re: A guide to Making Tax Digital?

Posted: May 26th, 2022, 4:06 pm
by pje16
why not try
https://www.comsci.co.uk/100PcVatFreeBridge.html
mentioned earlier in this post
(if you are ok using excel - basic, no need to be a guru)

Re: A guide to Making Tax Digital?

Posted: May 27th, 2022, 12:33 pm
by bungeejumper
Thanks very much, pje16. For the avoidance of doubt, folks, 100PcVatFreeBridge does indeed seem to work quite well - you just have to not be an eejit like me. :lol: And that means remembering to tell HMRC that you're going to use an MTD program, ideally a week or two before your deadline date (or not less than five days after your last online VAT return.) Otherwise you won't be allowed any access to your returns, and that's when the sky falls in.

Bridge software like 100PcVatFreeBridge needs to know exactly which cells on your spreadsheet it should lock onto when it's making your return for you. If you're anything like me, you're often adding or deleting rows to a sheet, so the surest way for 100PcVatFreeBridge to find its way is if you've given it named cell ranges, so that there can be no confusion.

Naming cells might not be in everyone's experience. I'd done it thirty years ago, but that was with Lotus 1-2-3, so it took me an afternoon to relearn the process with Excel. It isn't hard, but don't leave it till five minutes past midnight. Life is stressful enough as it is. :D

Thanks again, pje16!

BJ

Re: A guide to Making Tax Digital?

Posted: May 27th, 2022, 12:36 pm
by pje16
Thanks BJ
very pleased to hear you got it to work
Well done :D

Re: A guide to Making Tax Digital?

Posted: August 31st, 2022, 4:10 pm
by bungeejumper
pje16 wrote:Thanks BJ
very pleased to hear you got it to work
Well done :D


Hi pje6, guess what, it's me again. Nope, despite earlier hopes it's all gone wrong and I haven't been able to make it work! And I'm feeling like I want to chuck the whole thing in right now. Grrrr!

Okay, I've got the right cells set up for filling out the forms, and it's finding the right numbers. But when I hit "Refresh Obligations". two things happen:

First, I get "No content in table" in the top box. And second, I get:

Grant Authority

VAT authority needed (expired or never obtained). Performing grant authority procedure.
Failed to get VAT Authority!


This is ridiculous, since I told HMRC that I was going MTD back in May, so you'd think they'd have got the message by now. I've tried the VAT helpline at 0300 200 3700, and all they can tell me is that there's a queue eighteen hours long (I might be exaggerating a bit), and that I need to look up the MTD guide on gov.uk.

Surely I can't be the only person in the country who can't make head or tail of all this? There are probably at least a few stupider people than me?

Thanks for listening. Excuse me while I go for a little lie down. Any thoughts?

BJ