What is Making Tax Digital (MTD)?
Making Tax Digital (MTD) is the HM Revenue and Customs (HMRC) strategy to modernise the current tax system. For businesses it will involve mandatory digital record keeping and quarterly reporting using MTD compliant software.
On 1 April 2019 all UK businesses that are VAT registered and above the £85,000 VAT threshold will be required to keep their records digitally and submit VAT returns to HMRC using MTD-compatible software. Other areas of MTD, such as Income Tax and Corporation Tax, have been put on hold until 2020 at the earliest.
It is also important to note that HMRC has confirmed that charities will not be excused from MTD for VAT.