From April 2020, a number of Unit4 Business World (Agresso) UK customers will have to ensure they submit their VAT returns 100% digitally to the HMRC in order to comply with Making Tax Digital.
Although Making Tax Digital was originally introduced in April 2019, the HRMC granted organisations a soft-landing period of 12 months, during which time they have been permitted to use a copy/cut and paste method in place of digital links. This was designed to give organisations time to put in place the systems required for the law change.
For some organisations, this soft-landing period will end in April 2020, meaning they must ensure their VAT returns are submitted via a 100% digital link moving forward. For others, the soft-landing period will end in October 2020, a factor which is discussed later on in this article.
What is a digital link?
A digital link is a connection between two digital locations which facilities the transfer of the VAT data required for a return submission. In your case, that likely involves connecting your Unit4 Business World (Agresso) system to the HMRC’s systems via their dedicated API.
To help organisations understand how they can be compliant, the HMRC have outlined two key characteristics that a solution must comply with to be considered a digital link.
- Data must be transferred electronically between software products, systems or applications
- The transfer of the data must be automated, with no manual intervention required to move data between systems
Our Making Tax Digital solution, which has been specifically designed for Unit4 Business World (Agresso) systems, complies in full with these regulations, helping customers to ensure compliancy by their deadline.
As an added bonus, our solution also comes with a whole host of other benefits that are not found in other products, including compatibility with the Unit4 Business World (Agresso) desktop and web, various milestone versions and a number of complex VAT set-ups to name a few.
How do I know if my organisation has to comply by April 2020?
As discussed above, this soft-landing period of 12 months is only coming to an end for certain organisations, with some not having to comply with the 100% digital link requirement to October 2020.
This is because the HMRC originally delayed the original start date for organisations that they deemed to have ‘more complex VAT requirements’ to October 2019. A list of these organisation types is available below:
- VAT groups
- VAT divisions
- Foreign companies with a UK VAT registration
- Annual VAT return businesses
- Unincorporated charities
- Traders paying on account
- Certain public VAT payers
If your organisation fits into any of the categories above, you should have by now had confirmation from the HMRC that you were deferred until October 2019/2020. If not, it is likely that your organisation is expected to comply with the April deadlines.
Will my current bridging solution be sufficient?
During the soft-landing period, some organisations have used bridging solutions to ensure compliancy. These work by connecting into a spreadsheet with your data on and transferring it to the HMRC.
Long-term these solutions will prove problematic for organisations though, not least because of their reliance on spreadsheet formulas, and the problem of transferring data between multiple spreadsheets now no cut, copy or pasting is permitted.. Organisations should also consider the staff time bridging solutions require moving forward.
Our Unit4 Business World (Agresso) Making Tax Digital solution
As touched upon above, our Making Tax Digital has been specifically designed to not only comply with the HMRC’s 100% digital link requirements, but also to work with Unit4 Business World (Agresso).
This means we are able to offer customers a number of benefits that cannot be found with other solutions, including the access to an annual maintenance and support package to help ensure you are compliant moving forward.