As the launch date for Making Tax Digital (MTD) approaches it’s important for businesses to have MTD compatible VAT software to submit their tax returns. Any businesses that earns a taxable turnover above the MTD threshold (£85,000) is required to submit their tax returns using suitable VAT software, with over 100 vendors currently providing this software.
This means not all MTD VAT software is the same. There are many differences in the various types of software available, which makes choosing the best software quite difficult. Not all businesses have the same requirements for VAT software, but there are many common aspects of VAT software that most organisations benefit from.
Here are some of the most important aspects of VAT software that you may want to know about for Making Tax Digital:
Before you even consider investing in VAT software you must ensure it’s compatible with MTD requirements. HRMC has currently registered hundreds of different software products as MTD compliant, so make sure you choose such a vendor selling compatible software.
Furthermore, you should consider the software’s compatibility with other accounting software. To ensures the new VAT software can be integrated with current systems. For example, if your business uses only spreadsheets for the accounting then it’s important to choose VAT software that is compatible with Microsoft Excel.
Whether you’re an accountancy firm or a VAT-registered business, it’s important to have VAT software that is easy enough to setup and use. This is even more significant given the fact that MTD begins in just a few months, giving businesses less time to familiarise themselves with the software.
Cloud-based VAT software is typically best for installation and usability. This software allows users to login online to use the software, removing the hassle of installing software directly onto your network.
Security is vitally important for VAT software, for obvious reasons. The sensitive data being input into the system must be fully protected for the business and their clients, making security one a core aspect of VAT software.
Always check the encryption VAT software uses and the level of password protection it uses, along with other security measures in place to protect your data.
Customer support is another important aspect of VAT software. With strict deadlines in place and fines for failing to meet these deadlines, support should always be available to ensure any problems are quickly resolved.
Therefore, 24/7 support services are highly recommended, along with plenty of support resources such as FAQs, email support, phone support etc.