A new survey of UK tax professionals’ attitudes and readiness for Making Tax Digital (MTD) for VAT has revealed that companies have not fully implemented plans for digital VAT returns.
The survey, conducted by mass media and information firm Thomson Reuters, found that half of the companies that participated reported they are impacted by the 1 April deadline, and only 25% said their current processes met HMRC’s new requirements.
Additionally, 58% stated they have a plan yet to be fully implemented (compared with 70% in November 2018).
Looking at when companies expected to be “ready” for MTD for VAT, 64% of respondents cited they would be ready for MTD in the next six months, with 36% stating it will take them six to 12 months to complete their preparations.
The survey also asked whether continued uncertainty around Brexit negotiations had affected MTD preparations, with only 14% suggesting it had led to delays. The vast majority (77%) reported it had no impact on their MTD for VAT plans.
Kim Hau, senior proposition manager for Onesource Indirect Tax at Thomson Reuters said: “It is clear that companies have accelerated their efforts to prepare for MTD for VAT, and seeing the benefits of digital tax technology, rather than taking crude ‘sticking plaster’ approaches.
She added: “However, there are many companies still running the risk of not having their plans fully implemented and tested before both the April 2019 deadline, and the deferred deadline for ‘complex businesses’.
“Keeping these projects moving forward will ensure companies benefit from the automation, reporting, cost savings and improved compliance that digital tax technologies offer for MDT for VAT and beyond.”