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HMRC has updated its guidance on MTD for VAT with new information on keeping digital records in relation to supplier statements, petty cash transactions and charity fundraising events.

Businesses receiving a large number of invoices from the same source often record the value of supplies from a supplier statement instead of individual invoices. While HMRC prefers to see the individual supplies recorded, it will now accept the recording of totals from a supplier statement, provided all supplies on the statement are to be included on the same return and the total VAT charged at each rate is shown. Where supplies are recorded in this way, HMRC will also require businesses to cross reference all supplies on the supplier statement to invoices received, although this need not be included in the digital records. 

Where businesses use petty cash to pay for small value items, HMRC will now allow these transactions to be recorded as a single purchase, showing the total value and the total input tax allowable. This will apply to individual purchases with a VAT-inclusive value below £50 and only where the total value does not exceed a VAT-inclusive value of £500 per entry.

HMRC has recognised that charities may find it difficult to meet the strict digital record-keeping requirements for events run by volunteers, which can involve a large number of supplies needing to be recorded on a VAT return. The guidance now confirms that for such events, one invoice may be used to cover all supplies made for the event, with another invoice used to cover and all supplies received for the event.

See the revised guidance in Notice 700/22 at

Issue: 1442
Categories: News