Making Tax Digital

Updated 24 October 2018

The government has published the Value Added Tax (Amendment) Regulations 2018, which outline the requirements for Making Tax Digital for VAT.

The legislation will take effect on 1 April 2019. Businesses will need to implement the changes from the first VAT Return ending after 1 April 2019.

Who will this affect?

All businesses who are VAT registered and have a turnover over the VAT threshold (currently £85,000) will have to comply with Making Tax Digital for VAT purposes.

Those VAT registered businesses with turnover under the VAT threshold do not have to comply with the Making Tax Digital legislation, although may do voluntarily if they so wish.

What will be required under Making Tax Digital?

From 1 April 2019 Businesses will be required to:

  • keep their VAT business records digitally and;
  • submit their VAT return through compatible software using ‘application programming interface’ (API).  

From the same date the government gateway submission will no longer be available to those businesses under Making Tax Digital for VAT.


As from 16 October 2018, HMRC opened their pilot service to Sole Traders and companies (except those which are part of a VAT group or VAT Division) provided they are up to date with their VAT.

Partnership and those who trade with the EU, are based overseas, submit annually, make payments on account, use the VAT Flat Rate Scheme, and those newly registered for VAT that have not previously submitted a VAT return, are unable to join the pilot at this point.  

As we move closer to the 1 April 2019 deadline the pilot will be open to a wider range of VAT registered businesses.

Your business can join the Making Tax Digital pilot through your VAT Government Gateway login.  As a reminder businesses that join the Making Tax Digital VAT pilot will need to keep their VAT records digitally from the first day of the period covered by their next VAT Return.

Software Options

Most software providers will ensure their bookkeeping software will have the appropriate API to comply with Making Tax Digital. However you must ensure the software being used by your business is the most recent version to maintain the API link or if using a bespoke system that your provider is making the necessary upgrades to be compatible.

At Grafton Jones we support the vision of a digital tax system and as such are dedicated to helping our clients with their digital requirements.  With the additional time given by HMRC this is now the perfect opportunity to get ahead of the game and get the software which is right for you.

We will support any digital software you are currently using or wish to use.

Please contact us if you wish to discuss your software options or require further information on products available.

Based on details available to us at time of writing (October 2018), once further updates are received from HMRC we will provide additional information