Making Tax Digital – Your Questions Answered

6.  What is MTD enabled Software?

MTD enabled software is a software program or set of compatible software programs that must be able to:

• record and preserve electronic records in an electronic form;

• provide to HMRC information and returns from the electronic records in an electronic form and by using the Application Programme Interface (API) platform; and

• receive information from HMRC

7.  What records do I need to keep as part of MTD for VAT?

The following records must be kept in an MTD compliant manner:

Designatory data:

• Business name

• Address of your principle place of business

• VAT registration number

• A record of any VAT accounting schemes used

For each supply you make:

• The time of supply

• The value of the supply

• The rate of VAT charged

For each supply you receive:

• The time of supply

• The value of the supply including any VAT that is not claimable

• The amount of input tax that you will claim.

Your VAT account, including

• The output tax due on sales

• The output tax due on acquisitions from other EU member states

• The tax payable on behalf of your supplier under a reverse charge procedure

• The tax that needs to be paid following a correction or error adjustment

• The input tax claimable from business purchases

• The input tax allowable on acquisitions from other EU member states

• The tax reclaimable following a correction or error adjustment

• Any other necessary adjustment required by VAT rules