27 September 2018
From 1 April 2019 if your salon is VAT registered you will have to keep your VAT business records digitally and send in your VAT returns using Making Tax Digital (MTD) compatible software. This also applies if you use the VAT Flat Rate Scheme.
Although HMRC have changed the timetable for MTD a number of times, they have confirmed that, apart from VAT, it will not apply to other taxes until at least April 2020.
The deadlines for sending VAT returns and making payments are not changing, including monthly, quarterly and annual VAT returns, and Making Tax Digital does not require you to keep additional records.
To keep digital records and be prepared to send returns digitally, if you already use software you need to check if it's MTD compliant. HMRC have confirmed they have no plans to develop software themselves. Software will be provided by third parties and will not therefore be free. HMRC say they are working with more than 150 suppliers who will provide software in time for April 2019 to meet the VAT requirements. An NHBF trade member, GoSimple, is already on the HMRC approved list of suppliers.
While VAT returns are already submitted online, the changes will be more significant for salons who use spreadsheets to prepare their information
Hilary Hall, NHBF chief executive, said: "While VAT returns are already submitted online, the changes will be more significant for salons who use spreadsheets to prepare their information and then type in their figures, which will no longer be allowed under MTD. This is a good time to look into MTD-compliant software or talk to an accountant or book-keeper."
For further information
NHBF trade member directory
Webinars on Making Tax Digital