Making Tax Digital (MTD) means you won’t be able to keep and submit manual records after April 2019. Instead, HMRC will only accept VAT returns sent using software that supports Making Tax Digital for VAT.
What is ‘compatible software’?
Compatible software is a software product or set of software products that between them support the MTD obligations of keeping digital records and exchanging data digitally with HMRC through the MTD service. If more than one application is being used, data that flows between those applications must also be exchanged digitally.
Digital records can be kept in a range of compatible digital formats. They do not all have to be held in the same place or on one piece of software. For example, a spreadsheet can be a component of digital record keeping provided the product that consolidates records, or summary records from the spreadsheet, can exchange data digitally with HMRC
‘Bridging software’ is HMRC’s description of the digital tool that can take information from other applications, for example, a spreadsheet or an in-house record keeping system, and lets the user send the required information digitally to HMRC in the correct format.
Which software is MTD compatible?
HMRC’s list of all compatible software (including bridging software) is published here
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