From the 1st of April, the Making Tax Digital (MTD) initiative will be extended by HMRC to include VAT registered businesses below the current £85,000 turnover threshold. In light of this, Farmplan is encouraging all farming businesses to check that have MTD compatible systems in place.
Regulations require businesses to keep digital records of all transactions that make up the figures reported in their VAT return. If more than one system is used, these should be linked digitally and kept using an approved method. These will apply to all businesses that conduct VAT submissions, with the risk of penalties for those who do not comply.
“Many businesses making the switch to MTD are worried about the learning curve,” said Anne Cianchi, product manager at Farmplan. “There’s no need to worry in that regard. This is a tried-and-tested process that many of our customers have already made. In fact, we’ve found that once reluctant adopters make the change, not only are they surprised by how easy the transition is, but also by how many hidden benefits are suddenly available to them. From improved efficiencies to easier business performance analysis, the switch to MTD software often transforms the financial management of the farm”
Although the deadline might feel imposing, Farmplan is stating that making the change is not as challenging as it may seem. The company was one of the first to be recognised by HMRC back in August 2018 and has seen a lot of businesses successfully make the move.
The company highlights H Snelson & Son Ltd, a Farmplan company and an early adopter of the software.
“We wanted to get ahead of the game and ensure we were ready before the HMRC deadline,” said Andrew Nicholls of H Snelson & Son Ltd. “We have found it to be user-friendly, and we’re now working more proactively to simplify our farm accounts. For example, we can now easily put our invoices through the system rather than uploading them in bulk every quarter. This approach really takes the pressure off the team.”
Companies already using compatible software, the software much be linked to HMRC. When the VAT return is ready, it then just takes one click to submit figures.
“For some farms, this MTD requirement might feel like it’s a big leap,” added Anne. “However, it’s not as stressful or complicated as it can seem. By making use of the resources and the support available, the transition to MTD software will not only ensure compliance with the new rules but will also bring so many other benefits at every level of your business.”
For more information go to www.farmplan.co.uk