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HMRC may allow more time for MTD digital links

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HMRC has updated its VAT Notice 700/22: Making tax digital for VAT with information on when and how businesses may apply for an extension of the April 2020 deadline for having digital links in place for transfers of data between software applications. This recognises that businesses with complex or legacy IT systems may require a longer period to put digital links in place across their MTD software.

To be considered for an extension, businesses will need to:

  • make a formal application to HMRC as soon as possible for an extension and by no later than the end of their soft-landing period;
  • explain why it is unachievable and not reasonable to have digital links in place by the MTD VAT digital links mandation date (April 2020, or October 2020 for deferred businesses);
  • submit details of the systems that are unable to be digitally linked (providing a current map of existing VAT systems, highlighting the exact areas that cannot be digitally linked);
  • provide a clear explanation and timetable for when and how the business will become fully MTD compliant (ordinarily no later than one year from the end of the soft-landing period); and
  • state the controls to be put in place to ensure any manually transferred data is moved accurately and without error.

The guidance states that cost alone is not sufficient reason to apply for an extension, which HMRC only intends to grant in exceptional circumstances.

See VAT Notice 700/22 (section at

Issue: 1462
Categories: News