Live from QuickBooks Connect London - QuickBooks Online with Making Tax Digital

'Making Tax Digital' is the name given to the United Kingdom's overhaul of their VAT (Value Added Tax) system manual process with a digital process. MTD, as it is now being called, has a requirement to keep all VAT-related tax records in digital form, and to file all VAT Returns using software via HMRC's (Her Majesty's Revenue & Customs department) API (application programming interface).

As a part of this process, HMRC officially recognized various software providers for purposes of supporting 'Making Tax Digital' compliance. Intuit QuickBooks is one of those software providers. QuickBooks (U.K.) updated for MTD:

  • Records your finances digitally
  • Links your business and VAT information to all your transactions
  • Compiles your VAT Data from the transactions stored in QuickBooks
  • Calculates the VAT you owe, and reminds you when your VAT return is due
  • Supplies your VAT data directly to HMRC

As part of the process of compliance, the final values for the VAT must be imported into HMRC-recognized MTD-compliant software using something called ‘bridging software’. The MTD updated (U.K.) version of QuickBooks software includes a bridging option that is used to connect QuickBooks HMRC systems. Then, report the required VAT information digitally to HMRC, and for information to be sent digitally back to the business from HMRC.

In some cases, the bridging software is used where you have a complex VAT scheme which requires a calculation to be made outside of QuickBooks; as in the case of a partial exemption, TOMS, or you are the member of a VAT Group.

In addition to being MTD-compliant, QuickBooks just introduced a new 'Smart Check' feature which is designed to identify errors before you file your VAT returns.

Smart Check should prevent most common errors on your VAT returns by displaying detailed information needing attention or correction broken down by VAT codes.

Once all necessary adjustments and corrections have been made, submit your return to HMRC via Making Tax Digital fully integrated into QuickBooks (U.K.).

Once the return is accepted by HMRC, a notification is returned.

Intuit QuickBooks (U.K.) is not only compliant with Making Tax Digital, but has gone beyond the requirements to streamline the process and help ensure accuracy and make VAT transactional data accuracy, record-keeping, and compliance truly 'majestic.'

Source content captured during QuickBooks Connect London (presentation by Shaun Shirazian, Intuit's Head of Product, Europe) and/or from Intuit source material content.