Unternehmensleitfaden für MTD-Software

Was Sie über MTD-Software wissen sollten, wie sie die britische MTD-Strategie unterstützt, ihre Vorteilen und Herausforderungen.

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What is MTD?

Making Tax Digital (MTD) is the UK government’s initiative to modernize tax administration through mandatory digital record-keeping and software integration. For VAT-registered entities, MTD requires the use of ‘functional compatible software’ to preserve digital records and submit returns directly via HMRC’s API.

Crucially, MTD does not alter the frequency of VAT returns—whether monthly, quarterly, or annual—but transforms the submission mechanism. By enforcing a seamless digital journey from source data to HMRC, the framework enhances accuracy, reduces transposition errors, and aligns the UK with modern, near real-time compliance standards.

Read our guide to learn more.

Warum ist MTD wichtig?

Es gibt mehrere wichtige Gründe, warum die britische Regierung MTD als Teil ihrer Steuerverwaltungsstrategie eingeführt hat. Dazu gehören:

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Sicherstellen, dass Unternehmen und Privatpersonen den korrekten Steuerbetrag zahlen

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Die Verringerung der Steuerlücke erreichen

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Die Steuerverwaltung effizienter gestalten und Fehler reduzieren

Streamlined Maintenance of Rules & Rates

Das Einreichungsverfahren von Umsatzsteuererklärungen vereinfachen

Wie hat sich MTD entwickelt? 

Making Tax Digital (MTD) hat einige Rückschläge erlitten, vor allem aufgrund von COVID-19, das den vorgesehenen Zeitplan durcheinander gebracht hat. Mit der neuen Labour-Regierung könnte sich die MTD-Initiative ändern (oder auch nicht). Wir empfehlen Ihnen, sich auf dem Laufenden zu halten, um sicherzustellen, dass Ihr Unternehmen richtlinienkonform bleibt.

What is MTD software?

MTD software is a selection of digital financial tools compatible with the Making Tax Digital (MTD) initiative. Its primary function is to send a business’s digital financial records directly to HMRC via HMRC’s API.

One of the MTD requirements is 'digital links'—the electronic exchange of data between software programs, products, or applications without manual intervention. Digital records can be submitted in a range of formats, including XML, CSV, and Excel, provided they are API-enabled. 

These stored financial records must include designatory data and summary VAT data for the period. The format of these VAT returns is a 9-box summary filed via the HMRC’s JSON API platform, which must be digitally linked between the customer’s source data and the submitted digital return. 

MTD software is integral to Making Tax Digital (MTD) because the initiative can’t be rolled out successfully without it. No MTD software means no digital, real-time data for HMRC!

Who is subject to MTD for VAT?

Since 1 April 2022, the scope of MTD for VAT has been universal. The legislation no longer distinguishes based on the VAT registration threshold (currently £90,000). Consequently, all VAT-registered businesses—including those voluntarily registered with lower turnover—must now utilize functional compatible software for every return period.

There are no 'phased' entry dates remaining; compliance with 'MTD for VAT' is mandatory today. Limited exemptions exist only for those who can prove 'digital exclusion' to HMRC, or businesses subject to insolvency procedures.

What are the benefits of MTD software?

While driven by HMRC compliance, the adoption of MTD software offers tangible operational advantages for businesses:

 

Risk Mitigation: By automating data transfer via digital links, businesses significantly reduce the risk of manual transposition errors, thereby minimizing exposure to compliance enquiries and potential surcharges.

 

Financial Visibility: Moving to near real-time digital record-keeping provides businesses with an up-to-date view of their tax position. This enhanced visibility transforms VAT data from a retrospective reporting requirement into a tool for proactive cash flow management and accurate financial forecasting.

What are the challenges of MTD software?

While MTD drives long-term efficiency, the transition presents immediate operational hurdles for many businesses:

Transitional Resource Allocation: The shift requires an upfront investment of time and capital; not just for software subscriptions, but for staff training and the migration of legacy data.

Digital Link Complexity: For smaller businesses accustomed to manual records, establishing compliant 'digital links' (avoiding copy-paste) often requires a steep learning curve or the adoption of bridging software.

Dependency on Connectivity: Unlike paper records, MTD creates a total reliance on software availability and internet connectivity.

Data Security Responsibility: While software providers manage the API security, businesses effectively become data stewards. This necessitates rigorous internal controls and strict access management to protect the digital tax account, though this is a best-practice standard rather than a new regulatory cost.

Avoid penalties for MTD for VAT non-compliance

HMRC currently enforces a two-tier penalty structure: one for process failures and one for lateness.

MTD Compliance Penalties: Failure to adhere to MTD rules triggers specific sanctions. Filing a return without using functional compatible software (e.g., manually typing figures into the portal) can result in a penalty of up to £400 per return. Additionally, failing to maintain digital records or the required ‘digital links’ can attract daily penalties of between £5 and £15 for every day the non-compliance continues.

Late Submission & Payment: The old ‘Default Surcharge’ regime has been replaced by a points-based system for late submissions and a tiered percentage penalty for late payments, alongside daily interest charges.

Die Implementierung von MTD-konformer Software ist ein Teil der gesamten MTD-Transformation, die britische Unternehmen in den nächsten Jahren durchführen müssen.

Wie jedes Überarbeitungsprojekt bringt Making Tax Digital (MTD) sowohl Vorteile als auch Herausforderungen mit sich, die jedes Unternehmen individuell bewältigen muss. Dies betrifft auch für die Integration neuer Finanzprozesse, die MTD-Software unweigerlich mit sich bringt. Die Vorteile der MTD-Software sehen jedoch vielversprechend aus. Das Beste, was britische Unternehmen jetzt tun können, ist, sich vorzubereiten, sich über die neuesten Nachrichten zur MTD auf dem Laufenden zu halten und nach Softwarelösungen zu suchen, die für ihre speziellen Bedürfnisse und Anforderungen geeignet sind.

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FAQ's

Making Tax Digital (MTD) is a UK government initiative requiring businesses to keep digital records and submit VAT returns using UK-MTD-compatible software. It streamlines VAT compliance, reduces errors, and helps businesses stay up to date with with their VAT filing & submissions.

VAT automation software helps enterprises reduce manual errors, improve reporting accuracy, stay compliant with local and international VAT rules, and create a digital audit trail. It also saves time for finance teams and supports audit readiness.

MTD VAT software can integrate with leading ERP platforms such as SAP and Oracle, enabling automated VAT calculations and digital submissions. This ensures seamless data flow and compliance with HMRC requirements.

All VAT-registered businesses in the UK above the VAT threshold must comply with MTD for VAT. This means keeping digital records and using approved software for VAT submissions.

An optimal VAT solution provides automated VAT calculation, multi-country support, digital recordkeeping, audit trails, and integration with ERP, e-commerce, procurement, and other transactional systems. Additionally, look for an integrated solution that supports the end-to-end tax lifecycle from determination to reporting to audit and planning. These capabilities help ensure compliance and simplify VAT management for large organizations.

Yes, some VAT software supports real-time reporting and e-invoicing mandates, ensuring businesses meet regulatory requirements for digital submissions and structured data formats in countries that have mandates requiring those. See Vertex e-Invoicing and Vertex VAT Compliance

Non-compliance with MTD VAT rules can result in penalties, fines, and increased audit risk. Using compliant software and keeping digital records helps businesses avoid these issues and maintain good standing with HMRC.

You can request a demo to see how MTD-ready VAT compliance software automates reporting, e-invoicing, and keeps your business compliant with UK and EU digital tax mandates.