Making Tax Digital

 We’ve recently had the odd client asking us about whether using Rapport3 makes them compliant with HMRC’s new rules about holding 'Digital Records'. This is a term often mentioned during HMRC’s 'Making Tax Digital' information campaigns, about a new VAT submission mechanism which comes into effect in April 2019!

 The term 'Digital Records' means that you are using an electronic device like a computer, phone, tablet, etc. to store tax records, and that data transferred between applications is done electronically. The theory is that using these devices can help prevent mistakes often made when keeping records on paper.

Another term that is often mentioned is 'Digital Links', which at the moment is mainly referring to the specific API by which HMRC will only access VAT returns from April onward. Due to our developed range of integration modules, most of the accounting packages that Rapport3 integrates with have the facility to make electronic VAT return submissions to HMRC. If Rapport3 users are using an accounts package that doesn’t have this facility, they can use a stand-alone service for their quarterly returns but should be able to transfer the data into it electronically.

When it comes to Rapport3, and our clients that use an integrated accounts package (such as Xero or Sage), they are already using a computer and transferring data between applications automatically, so are streets ahead of the minimum requirement. For customers of Rapport3 who are using a non-integrated accounts package, there is still scope for error during manual entry of data, so they should think about upgrading Rapport3 to integrate with one of the accounts packages that support digital submissions in order to have an end-to-end streamlined solution.