HMRC’s mandate on Making Tax Digital for VAT

Making Tax Digital is the largest shake-up the Indirect Tax industry has seen in over a decade. From April 2019, 1.2m businesses in the UK must submit their VAT filing via HMRC’s API, rather than manually keying in data online. Holding digital records for VAT filings, in a functionally compatible data repository, also becomes mandatory.

A full audit trail, showing that all information is “digitally linked” from source to report is another key requirement. (For more background, read “Are You Ready to Make Tax Digital?”). So, how can businesses tackle MTD?

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Challenges And Opportunities

The bridging software risk

For many businesses, VAT reporting hasn’t changed for years, with operations based predominantly on Excel. Data is extracted, manipulated, cleansed, added up and adjusted – often all in an untracked Excel environment.

Tackling this with “bridging software” simply adds another step to the process; bolting on an API submission mechanism to satisfy the HMRC mandate. However, with Arkk there is an opportunity to use Making Tax Digital to significantly transform your VAT process, and more.

Addressing VAT return challenges

Typically, businesses face these common difficulties in relation to their VAT returns:

VAT is an arduous and time-consuming task.

Manual data input and revisions are prone to human error.

Where multiple contributors are involved the risk of error increases.

Reviews and potential fines from HMRC are a concern.

Constant time pressures of repeating this process every quarter.

These challenges can not only be addressed by adopting Arkk’s solution but through our platform we open up new opportunities to drive greater efficiency within your business.

HMRC recognised with more to come

Arkk Solutions is a recognised HMRC supplier for Making Tax Digital, meaning our platform allows you to submit via the API simply and quickly. But this is just the beginning…

Turning MTD into a powerful tool for the future

Making Tax Digital represents the start of HMRC’s journey to become “one of the most digitally advanced tax administrations in the world.” That’s why our platform offers significantly more functionality to transform VAT returns into a totally digital process, end to end.

Benefits And Key Features
The Arkk Solutions Difference

Intelligent machine learning for deep interrogation and improved accuracy

The days of manually checking a sample of invoices are over. Standard checks on the Arkk platform will automatically look for duplicate invoices or rows of data lacking information. The platform also features machine learning algorithms which interrogate every line-item of data, searching for patterns. The platform will flag any inconsistencies, allowing your VAT team to investigate. Best of all, the platform learns over time, so the fix and verification step will become faster and more accurate after every reporting period.

Fully compliant digital audit trail

Showing a ‘digital link’ between the raw data and your final submission is vital for Making Tax Digital compliance. Our platform tracks every change made to your returns, producing a full digital audit trail. You can link to your existing ERP system, and work within Excel, safe in the knowledge that every step is digitally logged on the platform.

Flexible and future proof

Need to update Partial Exemptions or make industry-specific adjustments? No problem. Make changes within your templates and examine our Value Inspector to see a breakdown of all adjustments, all tracked with a digital record. You can add or remove as many steps to the Arkk platform as you need, creating a bespoke process to fit your needs. We’re also preparing for HMRC’s Corporation Tax branch of MTD reporting in 2020, so as their digital requirements grow, so does our platform.

Making Tax Digital latest news & Insight
Are you ready for Making Tax Digital?
Firms must comply with the new mandate from April 1st 2019. Join Arkk Solutions on our journey to evolve VAT returns into a streamlined intelligent process, ready for HMRC’s digital future.