Avoiding Making Tax Digital for VAT penalties
The Tax Faculty’s Caroline Miskin provides advice on avoiding Making Tax Digital for VAT penalties, including what to do if things go wrong and HMRC’s so-called light touch approach. Her key advice is: whatever issues you may have with filing a VAT return, pay the VAT by the due date.
Making Tax Digital (MTD) for VAT has now reached a critical stage. The first mandatory monthly returns, for April 2019, were due on 7 June 2019 and the deadlines for the first mandatory quarterly returns are 7 August, 7 September or 7 October 2019, depending on the stagger group and assuming electronic payment.
There will inevitably be hiccups along the way and some businesses may struggle to file their returns. What should a business do if things go wrong and what are the penalty implications? Much has been said and written about soft landings and HMRC taking a light touch approach to penalties, but what does this mean in practice?