HMRC

Her Majesty’s Revenue and Customs (HM Revenue and Customs or HMRC) is a non-ministerial department of the UK Government responsible for the collection of taxes, the payment of some forms of state support, the administration of other regulatory regimes including the national minimum wage and the issuance of national insurance numbers.[1]

The department is responsible for the administration and collection of direct taxes including Income Tax, Corporation Tax, Capital Gains Tax (CGT) and Inheritance Tax (IHT), indirect taxes including Value Added Tax (VAT), excise duties and Stamp Duty Land Tax (SDLT), and environmental taxes.

Making Tax Digital

Revenue and Customs Digital Technology Services (RCDTS) is a subsidiary of HMRC established in 2015 to provide technical and digital services.

This is the government’s plan for individuals and companies for tax issues so that the HRMC becomes one of the crudest tax administrations in the world.

Issues of potential impacts such as VAT, business and income have already been investigated and evaluated.

Making Tax Digital includes:

• Keeping and maintaining your VAT accounting records
• Creating VAT Returns
• Sending the VAT Returns to HMRC.[2]

VAT-registered businesses with a taxable turnover above the VAT threshold (.000 85,000) are now required to follow the Making Tax Digital rules by maintaining digital records and using software to file their VAT returns.

• It is compulsory to sign up for Making Tax Digital for VAT if the taxable turnoveris more than £85,000. But from April 2022 it will be compulsory for all the VAT-registered businesses.
• The first step is to find a software that’s compatible with Making Tax Digital for VAT. Using software will allow you to submit VAT Returns directly to HMRC without needing to visit HMRC’s website. In the following website you can use a tool to find the right software: https://www.tax.service.gov.uk/making-tax-digital-software?_ga=2.110751109.1061994407.1645194677-475971746.1642158399
• To sign up the following information is required: business email address, Government Gateway user ID and password, VATregistration number and latest VAT
• You should get a confirmation email from noreply@tax.service.gov.uk within 3 days of signing up.

 

Website to sign up: https://www.tax.service.gov.uk/vat-through-software/sign-up/are-you-ready-to submit?_ga=2.83954073.1061994407.1645194677%20475971746.1642158399

Figure 2 Website of Gov.Uk, https://www.access.service.gov.uk/login/signin/creds?aoc=Y

The following website offers all the important information regarding the procedure of signing up: https://www.gov.uk/vat-record-keeping/sign-up-for-making-tax-digital-for-vat

References

Report on the United Kingdom’s Digital Services Tax. (2013, January). OFFICE of the UNITED STATES TRADE REPRESENTATIVE EXECUTIVE OFFICE OF THE PRESIDENT. https://ustr.gov/sites/default/files/files/Press/Releases/UKDSTSection301Report.pdf

Overview of Making Tax Digital. (2021, September 21). GOV.UK. https://www.gov.uk/government/publications/making-tax-digital/overview-of-making-tax-digital

Government Digital Service. (2015, February 24). VAT record keeping. GOV.UK. https://www.gov.uk/vat-record-keeping/sign-up-for-making-tax-digital-for-vat

Wikipedia contributors. (2022, February 4). HM Revenue and Customs. Wikipedia. https://en.wikipedia.org/wiki/HM_Revenue_and_Customs

Wattanajantra, A. (2022, February 4). MTD for VAT FAQs: 19 key Making Tax Digital questions answered. Sage Advice United Kingdom. https://www.sage.com/en-gb/blog/mtd-for-vat-questions-answered/

[1] https://en.wikipedia.org/wiki/HM_Revenue_and_Customs

[2] https://www.sage.com/en-gb/blog/mtd-for-vat-questions-answered/