From April 2019, all VAT reporting for businesses with a turnover above £85,000 (the current VAT threshold) will have to report their VAT return information into the HMRC’s new online system. The widely used method of going to the HMRC website and filling in the figures on their screen will no longer be available. The new VAT reporting rules may sound scary and you might be told that you have to go onto a new accounting system to be able comply. This is not necessarily the case according to Somerset Chamber members Springboard IT who have been recently recognised by the HMRC to build links to the Government Automated Gateways including the VAT reporting gateway. They have developed a software bridge which may be all your business needs to be ready for HMRC’s new VAT rules, greatly reducing the cost of updating existing software packages.
The recognition allows them to work with businesses to build compliant solutions where the existing system already complies with the current record keeping and preservation regulations. They can create software to collect the totals from those systems electronically (possibly using existing reports), store and preserve the VAT account information and transfer it electronically (without amendment) to the VAT Gateway.
The rules for complying with the new VAT reporting regulations apply simple, quite generalised compliance criteria. The legislation retains what is currently in place with regards to keeping and preserving records. The legislation additionally provides for keeping and preserving digitally some designatory data (business name, VAT registration number etc.) and totals for information relating to each VAT account.
So existing systems that are currently compliant with the regulations regarding keeping and preserving of records should still be compliant. All that needs to be added is a solution for keeping and preserving totals relating to each VAT account and using those totals to electronically send the values for the existing 9 boxes directly to the VAT Gateway.
At one end of the scale this might be a less risky approach for businesses facing significant projects to update and change current systems to comply, or at the other end of the scale it may allow businesses that have simple solutions (Spreadsheets for instance) that work perfectly well and already keep and preserve VAT information as required by current legislation to continue using them with a simple bolt on.
Springboard IT firmly believes a similar approach will be taken for the next step which comes into force in 2020 although those regulations and systems are not yet fully defined. The next step covers the collection and transmission of accounting information quarterly. They expect to extend their VAT solutions to comply with those regulations.
For more information, contact Springboard IT on 01934 710666