Making Tax Digital
HMRC are proceeding with their plans to digitise tax administration.
We believe that they will further develop their systems so that, when a VAT return is submitted online, they will interrogate the software used for the VAT return submission and ask it if VAT has been accounted for on any cash received, or claimed on any cash paid, without a supporting invoice. If the software says “Yes” to that question, then the VAT return may be rejected.
We predict that HMRC will have these procedures in place within two years from now.
When assisting with VAT returns, all monies paid to suppliers and all monies received from customers (or clients or guests, depending on your type of business) should normally be supported by an invoice. If there are any questions on this please get in touch with us to agree on the action to be taken.