Digitally recorded transactions soon mandatory in the UK
Do you own a VAT-registered business in the UK? Then you should be aware of some new regulations coming your way soon. The UK government will require your business to sign up for Making Tax Digital for VAT (MTD) as of November 1st, 2022.
What is MTD? Simply put, it’s a mandate that businesses record their transactions and taxes digitally. The initiative was first announced in 2015 and first implemented in 2019. Since implementation, VAT-registered businesses with turnover exceeding the £10,000 VAT threshold have been required to keep records digitally.
The idea behind this initiative is to make administration more efficient, resilient, and productive. MTD aims to make reporting more transparent and faster, freeing up more time for business owners. Keeping records in real time provides a more accurate picture of your business and allows you to make more informed decisions.
So what’s changing in November? The account you use to send in these records. You’ll have to use the new MTD account to file monthly and quarterly VAT reports. Luckily, signing up is easy. All you need if you’re a business owner is:
Your business email address
A Government Gateway ID and password, which you can create during the signup process
Your VAT registration number and latest VAT return
Your National Insurance number (for sole traders), company registration number, and Unique Taxpayer Reference (for limited companies and partnerships)
You’re also required to have HMRC-compatible accounting software before signing up. The UK government happily offers support to businesses making the shift to digital. Together with the MTD Accessibility Working Group and Additional Needs Working Group, HMRC ensures all businesses have access to online accounting software.
This includes working with software developers to make sure there are options available for individuals with cognitive, visual, motor, or hearing difficulties.
Digitisation made simple
With the state of payment technology today, digitising your business is easier than ever. Adopting digital bookkeeping now helps ensure you’re ready for the shift in regulations. For a simple, all-in-one point of sale solution that will satisfy HMRC and streamline your business tasks, check out SumUp Point of Sale.
SumUp POS shows you sales records, average order volume, customer orders, and more all on one screen. You can manage your inventory and review your stock in a few taps, as well as receive real-time updates automatically.
With features geared towards various business types, SumUp POS makes life easier whether you’re in retail, gastronomy, or hospitality. Customers can place orders easily, you can save their data to offer more personalised service next time, and you can download detailed analyses of your business’ performance. It also speeds up your checkout with fast orders and flexible payments, so you can process transactions in-person or remotely using your POS.
What makes SumUp POS the ideal accounting solution for small businesses is the range of integrations and add-ons available. In addition to all of the features on offer, we’ve made our POS system compatible with dozens of other services so that your business needs are covered.
Using SumUp POS gives you access to two HMRC-approved accounting solutions for making tax digital. QuickBooks and Xero let you get ahead of the game and easily set yourself up to fulfil your online accounting obligations.
If you have a QuickBooks account, you can connect it to your SumUp POS through the dashboard, by following the steps on the screen. QuickBooks stretches across every aspect of your finances, from payroll to sales to tax returns.
Connecting your bank account lets you see real-time sales reports, payment details, and earnings forecasts. Streamline payroll with automatic pay runs, pension enrollment, and automatically filing payroll tax.
Most importantly, QuickBooks ensures you’re compliant with VAT tax regulations because it automatically calculates and files your VAT returns with HMRC. You can set up reminders to make sure you always know when the due dates are coming and how much tax you owe.
Connecting QuickBooks to your SumUp POS means:
Changes in sales and inventory are automatically logged.
Every product and category can be mapped to specific items or services.
You can create and edit any service or delivery charges.
Connecting QuickBooks to SumUp POS means your sales data is used to create your VAT return and you’ll never miss a filing deadline.
Your other option for an accounting solution compatible with Making Tax Digital is Xero. Like QuickBooks, Xero is MTD-compliant, and it’s already gotten massively positive feedback. 88% of users say Xero makes MTD easier for them.
In addition to automatically filing VAT returns for you, Xero lets you:
Pay your bills on time. Just enter the account information and payment schedule.
Manage your staff with Xero Payroll.
Store important files online.
Track and manage fixed assets.
Create and send purchase orders.
Connecting Xero to your SumUp POS means no more manually entering your sales info or updating your records. The integration transfers all that information seamlessly to your Xero account, which saves loads of time and gets you your reports instantly.
There are a host of other integrations that target other areas of your business; Deliveroo for food delivery, Mailchimp for email marketing, Workforce for staff management, and the list goes on. You can even build your own integrations if you’ve got coding skills.
Go digital now
The UK is steering its economy towards digitisation by requiring VAT-registered businesses to file their returns electronically. All you need to do to get started is sign up on the UK government’s website, as long as you have HMRC-recognised software in place.
SumUp POS gives you two great options for said software, saving you time by automatically sharing your financial data. That means you’ll have sales reports, future projections, and VAT reports available without any extra work. Automating your VAT returns also eliminates human error – computers don’t misread numbers.
Interested in how SumUp POS can help your business? Use the form below to get in touch with our sales team.
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