From 1 April, 2019, HMRC mandates the use of the Making Tax Digital (MTD) service to keep records digitally and use appropriate software to submit VAT returns. This means that all VAT-registered businesses with taxable turnover above the VAT threshold will be required to submit VAT returns digitally.
To ensure you and your clients are compliant, Surf Accounts has introduced a new feature MTD VAT Returns which will enable you to digitally file and record your VAT Returns for UK businesses. To access the feature, log in and on the left panel, go to General Ledger > MTD VAT Returns.
For more information and steps to use the feature, click the following links, as required.
- Authorising Surf Accounts
- Finalising VAT Returns
- Submitting VAT Returns
- Clearing VAT Returns Records
- Printing VAT Return Records
You need to fulfill the following conditions on Surf Accounts prior to accessing the feature.
- The business location is United Kingdom. To verify, go to Settings > GENERAL SETUP > Business Details.
- You should sign up with HMRC. See HMRC's detailed guidance at https://www.gov.uk/guidance/sign-up-for-making-tax-digital-for-vat. You should ensure that you have signed up at least a week before you intend filing your next VAT return. Note in particular that if you are currently paying VAT by direct debit, you cannot sign up in the 7 working days leading up to, or the 5 working days after your VAT Return is due.
Before you start using the Making Tax Digital (MTD) service to submit VAT returns digitally, you need to provide a one-time authorisation to Surf Accounts to interact with HMRC on your behalf.
1. Sign in and click the required business.
2. Go to General Ledger > MTD VAT Returns.
3. On the Information Message window, click OK.
4. Carefully read the HMRC webpage instructions on authorisation and click Continue.
5. On the login page, enter the login credentials and click Sign in. Note that the credentials are unique to the business.
6. Confirm authority grant by clicking Grant authority.
7. The VAT Return page appears. It shows the following information.
|Original Amount||Amount payable to the HMRC on the VAT return.|
|Outstanding Amount||Amount that the HMRC considers to be outstanding on the return.|
|Return Status||VAT returns that are considered completed by HMRC will have status Fulfilled. If a new VAT obligation period is available from HMRC, it will appear in the list, with status Open.|
Post authorisation, the VAT Return page will appear whenever you attempt to submit or view VAT returns status.
To submit the VAT returns, you need to first generate and finalise the VAT amount payable during a quarter. To generate and finalise, complete the following steps.
1. Click and then click Generate VAT Return.
2. Read the message on the Confirmation Message window, select Include these transactions on this VAT Return and click Proceed.
3. On the Confirmation Message window, click OK.
4. The generate VAT return window shows the net VAT payable.
5. To finalise, select Finalise and click Save.
The table is explained below:
|VAT due this period on sales and other outputs (Box 1)||The total VAT payable until this period. The VAT is derived by adding the VAT figures of all sales invoices.|
|VAT due this period on acquisitions from other EC member states (Box 2)||The total VAT derived from purchase invoices raised on purchases from non-UK EU members. For example, if a purchase invoice is paid by a UK Business for a supplier based in Spain, the VAT amount is accounted in this column.|
|Total VAT due(the sum of boxes 1 and 2) (Box 3)||Total of values in Box 2 and 3.|
|VAT reclaimed in this period on purchases and other inputs(including acquisitions from the EU) (Box 4)||The total VAT derived from all purchase invoices VAT values.|
|Net VAT to be paid to Customers or reclaimed (difference between Box 3 and Box 4) (Box 5)||The difference between box 4 and 3.|
|Total value of sales and other outputs excluding any VAT(include Box 8 figure) (Box 6)||The total value of all sales invoices until the selected period excluding VAT.|
|Total value of purchases and other inputs excluding any VAT(include Box 9 figure) (Box 7)||The total value of all purchase invoices until the selected period excluding VAT.|
|Total value of supplies of goods Goods excluding any VAT to other EC Member States (Box 8)||The total value of all purchase invoices excluding VAT from a UK Business to other non-UK, EU members.|
|Total value of acquisitions of goods Goods excluding any VAT to other EC Member States (Box 9)||The total value of all goods acquired through purchase invoices from non-UK, EU members and sold through sales invoices to other non-UK, EU members.|
|Total value of supplies of related services Services excluding any VAT to other EC Member States (Box 10)||The total value of all purchase invoices showing services excluding VAT from a UK Business to other non-UK, EU members.|
|Total value of acquisitions of related services Services excluding any VAT to other EC Member States (Box 11)||The total value of all services acquired through purchase invoices from non-UK, EU members and sold through sales invoices to other non-UK, EU members.|
6. The Return Status changes from Open to Generated and the Original Amount heading shows the payable VAT.
- Print the Return to see the detailed breakdown of all the values. You can also view the same on the VAT Return report. This does not yet mark any of the transactions as being on the VAT return, and you will need to Generate again when you're ready to proceed with the return.
- Save the Return, which will mark transactions as being on this VAT return. After clicking the Save button, click OK on the Confirmation Message window. The Return Status changes from Open to Generated and the Original Amount heading shows the payable VAT. Note that this option does not finalise the VAT return.
- Close if you don't wish to continue with the VAT return at this time.
Post finalisation, Surf Accounts is ready to submit the VAT returns. During the submission, you can manually adjust the VAT amount, if required. There may be situations where the VAT values calculated by Surf Accounts do not match your actual VAT liability. For example, if you use a Retail Scheme or Flat Rate Scheme, different VAT calculations apply. You also need to declare if you are submitting VAT returns on your own or an agent submitting on behalf of a business. Complete the following steps to submit.
2. Click and click Submit VAT Return.
You need to have the right to submit VAT return. If you do not have the right, go to Settings > GENERAL SETUP > Users and on the Permissions window, select Send VAT Return under the VAT Returns heading.
3. Carefully review the VAT return amount.
4. If you are happy with the VAT returns and want to go ahead with the submission, do the following:
- If you are submitting for your own business, select I am submitting my own VAT Return . Else, if you are an agent submitting on behalf of a business, select I am acting as an Agent for this business.
- Select the declaration.
- Click Submit.
- To adjust or change the VAT return values, click Manually Adjust.
- On the Confirmation Message window, click OK.
- Under the Adjusted Values headings, update the values, as required.
- Provide the necessary declarations and click Submit.
5. The VAT returns are submitted. Click OK.
6. The VAT Return page shows the status of the return as Submitted.
7. To view VAT returns details, click and then click View VAT Return.
8. The VAT returns details are shown.
Once a VAT return is submitted, it can not be amended or edited. Any amendments must be pursued with HMRC directly.
This feature allows you clear all VAT returns records for a quarter, finalised or non-finalised and return the status of the VAT returns to Open from Generated. This feature could be useful if you want to update your VAT returns records for a quarter. To clear VAT returns records, complete the following steps.
1. Click and then click Clear VAT Return. Note the VAT amount is already generated under the Original Amount heading and the status is Generated under the Return Status headings.
2. On the Confirmation Message window, click Yes.
3. On the Reconfirmation Message window, click Yes.
4. The VAT status returns to Open from Generated and the Original Amount heading shows no value.
The Print option allows you to generate and view the submissions, liabilities and the payment details.
On the VAT Return page, select the VAT record and click Print and then select from the following options.
This option generates the VAT Return report.
This option generates the VAT return liabilities between a time range you specify.
This option generates the total VAT returns submissions during a time range you specify.