MTD Update
Posted on 11 February 2019 at 10:02 UK time
MTD Update
Microsoft have been working on a structured process to manage the submission of VAT Return from within NAV/Business Central. This process has now been finalised for the latest release of Business Central. We are expecting to be able to download backwards compatible objects for supported Dynamics NAV versions (*see below for a list of the supported versions). These objects will need to be loaded into your database and documentation provided on how to use this process.
Microsoft are on the HMRC approved list of Vendors. As such, they have been developing an API (interface between NAV/Business Central and the HMRC portal) to digitally submit your VAT report from your NAV/Business Central solution and push this to the HMRC portal. There will be various messages passed between the two systems to submit, verify and approve your return information in NAV/Business Central. The following functionality will be available using this new reporting structure:-
- Visibility into your VAT obligations
- Creating VAT returns based on VAT obligations
- Reminding users of upcoming VAT obligations
- Submitting the VAT return to HMRC
- Viewing your VAT liabilities and payments
You need to be aware of which Dynamics NAV/Business Central versions will receive a Microsoft supported method:
| SUPPORTED VERSION | VAT RETURN OBJECTS |
| Dynamics 365 Business Central | Available Now |
| Dynamics NAV 2018 | Available Now |
| Dynamics NAV 2017 | Date TBC |
| Dynamics NAV 2016 | Date TBC |
| Dynamics NAV 2015 | Date TBC |
| UNSUPPORTED VERSIONS | VAT RETURN OBJECTS |
| Dynamics NAV 2013 | Not Available |
| Dynamics NAV 2009 | Not Available |
| Navision Financials Version 5 | Not Available |
| Navision Financials Version 4 | Not Available |
| Navision Financials Version 3 | Not Available |
| Navision Financials Version 2 | Not Available |
For more information, click below to go to the HMRC website:
Update Regarding the HMRC Enforcement Dates
3.2 .1.1 Soft landing regarding digital links requirements
HMRC will allow a period of time (‘the soft landing period’) for businesses to have in place digital links between all parts of their functional compatible software.
For the first year of mandation (VAT periods commencing between 1 April 2019 and 31 March 2020) businesses will not be required to have digital links between software programs.
This means that if Making Tax Digital rules first apply to you from either a:
- VAT period starting on or after 1 April 2019, you will have until your first VAT return period starting on or after 1 April 2020 to put digital links in place
- VAT period starting on or after 1 October 2019, you will have until your first VAT return period starting on or after 1 October 2020 to put digital links in place
During the soft landing period only, where a digital link has not been established between software programs, HMRC will accept the use of cut and paste as being a digital link for these VAT periods.
The Following Rule has the Force of Law...
A digital link is an electronic or digital transfer or exchange of data between software programs, products or applications.
The use of ‘cut and paste’ does not constitute a digital link.
The following rule has the force of law:
If a set of software programs, products or applications are used as functional compatible software there must be a digital link between these pieces of software.
This digital link is required where the data to be included in any of the boxes of the VAT Return has been prepared within a software program, product or application, and this data is then transferred to another program, product or application in order to submit the VAT Return data to HMRC via the API platform.
For VAT periods starting on or after 1 April 2020, there must be a digital link for any transfer or exchange of data between software programs, products or applications used as functional compatible software.