There is the monetary cost of overhauling existing systems and adding new ones - many small businesses, indeed, may not have had the budget to do so.
What eCommerce businesses need to do for MTD
It is evident that eCommerce sellers must positively digitise their accounting and register for MTD as soon as possible. As we discussed, the core issue with many online stores is the lack of awareness about tax laws and the business owner’s obligations. If you are in a similar boat, here is how you can be MTD-VAT compliant:
1. Set up MTD-compatible software
2. Keep complete financial records
3. Hire an accountant
4. Submit records only via the MTD portal
It is perhaps superfluous to state that all VAT-registered businesses must submit their VAT returns through the MTD portal, with the help of their digital records. They no longer have the option to use the old VAT portal or send physical returns by post – attempting to do so may attract penalties. Ask your accountant to guide you in this.