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JackS
JackS
January 28, 2022
Question

Making Tax Digital (MTD) Drop-in Session | Post Your Question!

  • January 28, 2022
  • 60 replies
  • 0 views

 

Since April 2019, Making Tax Digital (MTD) rules have only applied to businesses with a VAT taxable turnover above the £85,000 threshold. But the government plans to roll out this digital transformation across the entire tax system.

This may now change the way your business operates, so we want to make sure you're fully informed of the changes. You can find our MTD FAQ page here for more.

If you still have a question, please feel free to post below and an expert will answer you.


 

    60 replies

    J
    johnwhetstone
    January 31, 2022

    I have QuickBooks Premier Desktop 2016, is this compatible with MTD? If not is there a desktop version I can upgrade to? I need a desktop version as I'm out of the office most of the day visiting customers in remote places with very poor or no internet connection so an on-line version won't work for me. thanks. John

      A
      Ashleigh1
      January 31, 2022

      Hello Johnwhetstone, 

       

      Thanks for posting your question on this thread, so your right 2016 is not compatible with MTD, you would have to upgrade to 2021 desktop version however Desktop is discontinuing and you will no long be able to use it at all or have access to it, so you would need to either move have to move to online or to a different soft ware completely. Do you have a subscription for your 2016 desktop currently? 

      J
      johnwhetstone
      January 31, 2022

      Hello Ashleigh

      Thank you for your reply, unfortunately my subscription lapsed. Are there any resellers that would have a 2021 desktop version?

      I
      I313_2
      February 8, 2022

      Can anyone help me with the below error message?

       

       

       

       

       

       

       

       

      I used to click a button in the same place as this one, and it would let me submit my own VAT returns. Now, I can't do it and had to ask my Accountant to submit it for me.

       

      When I click the "Take Action" button, I'm taken to the next screenshot and I can't get make any sense of it. I've underlined an "Error Code" at the bottom "CLIENT_OR_AGENT_NOT_AUTHORISED"

       

       

      Any ideas?

       

      Thank you

      Rubielyn_J
      Rubielyn_J
      February 8, 2022

      Welcome to the Community, @I313_2.

       

      I can provide some idea about the error and how to fix it. This way, you can send your VAT returns successfully to HMRC on time and keep your account up to date.

       

      The error We can't connect to HMRC right now would usually show up if: 

       

      • The user ID and password are incorrect. 
      • Incorrect VAT registration number entered in the VAT settings
      • The current VAT return period has not ended yet. 

       

      To fix this, let's first enable the MTD. Then, you'll have to authorise QuickBooks first to interact with HMRC. Here's how:  

       

      1. Proceed to the Gear icon, then select Account and Settings.
      2. Choose Advanced on the left menu in the Accounts and Settings page, then click the Making Tax Digital header to expand the section. 
      3. Select on Learn how to connect, then click on Let's go on the Get started with digital tax page. 

       

      Once done, follow the steps below to complete the process:

       

      1. After clicking on Let's go, you'll be directed to the HMRC page as shown below. Select Continue to sign in.
      2. Enter your HMRC credentials to sign in.
      3. Choose on Grant authority to continue. Then the authorisation process will begin. 
      4. You'll receive a 'You're connected to HMRC' message as below.
      5. Choose Continue when the process has been completed, click on Take a look. 

       

      For additional info, please refer to this help article: Authorise QuickBooks to interact with HMRC - MTD for small businesses.  

       

      Whether you want to know more about MTD or have a burning question about the new changes and how it affects your business, this guide has everything you need to know.

       

      Keep in touch if you have further questions about submitting VAT returns. I'll be happy to lend a helping hand. Have a pleasant day!

      I
      I313_2
      February 9, 2022

      Thanks Rubielyn...

       

      I think my issue may be slightly different as I have an accountant who is setup as an agent... I believe I submit the returns through their agent account somehow... I have been submitting this way for about 18 months, and I'm sure a notification popped up to say that an authorisation had expired (after 18 months).

       

      Is there a different setup or solution for this one?

       

      Thank you for your help

       

      Ian

      V
      VBP1
      February 9, 2022

      Good day, as of 1 April 2022 the VAT records will have to be kept digitally. Is this a service offered by QB ? I have QB already in use since some time for VAT returns. Thanks

      A
      Ashleigh1
      February 9, 2022

      Hello VBP1, thanks for posting on this thread, So in quickbooks we have making tax digital . if you have a look here to shows you how to set it up in your account. 

      D
      Dave Green
      March 31, 2022

      Hi, I've submitted a VAT return correctly via quickbooks/tax made digitial.  Now on the VAT page there's a message saying "We can't connect to HMRC right now".  I've reauthorised the connection but it still doesn't connect.  My next return isn't due for a few months - looking at the messages above am i right to think this message will remain until closer to the time when the next return is due?

      Thanks

      A
      Ashleigh1
      March 31, 2022

      Hello Dave, Yes that is correct, so it will be blocked until it nears the next submission date. So that message will show until near a the next submission for you. 

      D
      Dave Green
      March 31, 2022

      Great thanks for confirming that, the message is a bit confusing, was a bit worried because it says it cannot connect but good to know. Thanks

      B
      BucksHoney
      April 26, 2022

      Hi, My business allows me to sell products at zero rate vat and I am VAT registered. This allows me to reclaim VAT on all my purchases made for the company. I am about to make my first MTD (and VAT) submission but need to reclaim vat from purchases made in the past. I understand that I go into the prepare VAT and make an adjustment to box 4 but which account do I choose from the drop down. Other q&a answers say pick an income account but these are all purchases which are made against items logged in my equipment chart of accounts. Should I select my equipment chart of accounts or should I create a new account purely to hold this adjustment value?

      Also do I need to change the value in box 7 for total purchase to include the past purchases as well or leave it as quickbooks has calculated?

      thanks

      A
      Ashleigh1
      April 26, 2022

      Hello BucksHoney, 

       

      Welcome to the Community page, 

       

      This is the VAT adjustment article for you to look at here as you are reclaiming VAT that is reducing the VAT due. You should check with HMRC if box 7 is required to be reported as well. 

      P
      paulm99
      June 13, 2022

      Hi,

       

      I have just recently moved from Sage to QuickBooks. I have tried to set up our VAT and it asked me to file for a previous period - 1/6/21-31/8/21. I filed it but it has already been submitted through our previous software. 

       

      QuickBooks is now asking to submit the next VAT period 1/9/2021-30/11/21 but says it can't connect to HMRC. It has been like this for nearly a week now. 

       

      The first period I wanted to submit was 1/3/22-31/5/22. What do I need to do now?

       

      Thanks

       

      Paul

      A
      Ashleigh1
      June 13, 2022

      Hello Paul, thanks for posting on this thread, so if these returns have already been submitted to hmrc in a previous software, if you turn off mtd in the taxes section and the the main account and settings section and then go back to the return and click on the return and mark the period as mark as filed, if you do this to all the returns previously submitted until you reach the return you need. once at the return you need if you then turn mtd back on so in the main account and settings section and in the taxes section as well, so you can then submit the return to hmrc when you need to. 

       

       

      P
      paulm99
      June 13, 2022

      Hi Ashleigh,

       

      Thanks for getting back to me. 

       

      I have turned it off in the main accounts settings but can't see how to do it in the taxes section? If I click on the return I still can't see how to file it?

       

      Thanks

       

      Paul

      R
      Richard Paterson
      June 14, 2022

      Hi,I have some problems getting MTD working with Quickbooks online, although it shows in the VAT screen that MTD is enabled. I am stuck with the We can't connect to HMRC error. I've followed all the trouble shooting solutions in the Help that I can see and I have a VAT return due (to 31st May 2022), but all that is showing is old return info. I only took over doing these accounts in the Autumn 2021 and submitted VAT returns manually via the HMRC web site until now, not using this VAT screen at all. What can I do to resolve the problem?

        S
        SarahannC
        June 14, 2022

        Hello there, Richard Paterson.

         

        Appreciate you for letting me know that you've tried following some possible solutions to resolve the same error you've got. Still, I just want to include possible causes why that error appear.

         

        • You have not registered for MTD.
        •  You've registered for MTD but aren't connected to HMRC.
        • In QuickBooks, you must re-authenticate MTD.
        • You entered the wrong credentials for the Government Gateway.
        • Make sure you're using the right VAT number.
        • An accountant set up the MTD connection.
        • A client established the MTD connection (for accountants)
        • You have no outstanding HMRC commitments.

         

        For solutions, please check this article: Take action status when connecting to HMRC for Making Tax Digital (MTD). 
         

        If you're sure about the setup, can perform some troubleshooting steps to fix this. Let's start by accessing your account using a private browser. There are times that the browser is full of frequently accessed page resources, thus causing some errors and/or unusual responses. You can use either of these keyboard shortcuts:

         

        • Google Chrome: Ctrl + Shift + N
        • Mozilla Firefox: Ctrl + Shift + P
        • Microsoft Edge: Ctrl + Shift + P
        • Safari: Command + Shift + N

         

        If it works successfully, go back to your regular browser and clear the cache to prevent any unexpected behavior. Otherwise, you can use other compatible browsers in QBO. 

         

        If the same thing happens, please reach out to our customer support. They  would be really helpful because they have the capacity to check into your personal account in-depth, see what's going on, and even screen share with you if necessary. You can utilize the Help icon within QBO.

         

        Visit again if you have more concerns or need still need assistance with this matter. Take care and stay safe, Richard Paterson.

        M
        Michelle I
        July 4, 2022

        Hi, i will be doing first MTD vat return this quarter.  but i bought in transactions for last year so i can use for my year end accounts.  it won't let me reconcile the old vat returns in quickbooks without connecting to HMRC, i have already submitted them manually, and just want to do returns from this quarter forward.  how do i reconcile the vat account so it will let me do the next return

         

         

        JoesemM
        JoesemM
        July 4, 2022

        Welcome to the Community space, @Michelle I. I'm here to help you reconcile the old returns in QuickBooks.

         

        Since you already submitted the transactions manually, you can manually reconcile the old vat returns in QuickBooks. However, I'd still suggest contacting the HMRC first and verify if they received the old returns that you manually send to them.

         

        To manually reconcile the transactions, here's how:

         

        1. Go to the Accounting menu and select Chart of accounts.
        2. Find the account you’re reconciling and select Account history
        3. Click the transaction to expand the view.
        4. Select the box in the tick column until you see an R. This manually reconciles the transaction.
        5. Click Save.

         

        For more details on how to reconcile an account, see this article: Reconcile an account in QuickBooks Online.

         

        Upon sharing the steps above, I'd still suggest contacting your accountant. They can provide further guidance with the setup and provide more expert advice in dealing with this concern.

         

        Once done, you can start paying your current tax liability. These articles will guide you through the process:

         

         

        ​​Tag me in a comment below if you have other questions about VAT in QuickBooks Online. I'll be sure to get back to you. Take good care.

        D
        dd1010
        July 16, 2022

        i was due to submit 1st vat quarter when they switched me to mtd and i could not submit online as have been for years i joined QuickBooks in April it seems i cant submit 1st quarter only 2nd now so what do i do ?

         

         

        Thank you 

        R
        ReymondO
        July 16, 2022

        Thanks for joining the thread, @dd1010. I'll help you file the previous VAT returns in QuickBooks Online (QBO).

         

        To submit, you'll need to select a VAT scheme to edit or enter a starting date of your return. Let me walk you through the steps how:

         

        1. Go to the Taxes menu, and then choose VAT.
        2. Select Edit VAT from the Edit settings drop-down.
        3. Choose Date from Start calculating my VAT from drop-down list.
        4. Make sure to select the right filing frequency.
        5. Choose a VAT scheme and the correct Effective date for new scheme.
        6. Click Save.

         

        Let's also make sure to record the historical transactions from your first quarter correctly. This way, you can file your return seamlessly.

         

        When you're ready, you can now submit your VAT returns. Once done, you can record your tax payments in QBO to keep your information up-to-date. 

         

        I'll keep an eye out for your reply, so feel free to leave a comment below if you have more questions about filing your taxes. Have a good one. 

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