Making Tax Digital for VAT applies to VAT-registered businesses with taxable turnover in excess of £85,000. For VAT periods starting on or after 1st April, mandated businesses will be required to record transactions digitally and file their VAT returns using functional compatible software.
As a business owner you are required to keep your records. The time limit varies depending on whether you’re a sole trade or partnership, or a limited company. Broadly, most accountants would recommend holding on to your receipts for 6 or 7 years.
However, HMRC do not specify where you keep physical paper copies of your receipts, or whether you keep scanned copies. Even under MTD, HMRC do not insist that you keep scanned copies. So it's up to you whether you hold on to the paper receipts or scan everything in.
At TaxAssist Accountants, we work with Receipt Bank which is a receipt processor that stores your scans and pictures of receipts and captures the information necessary for your bookkeeping records.
By Jo Nockels
Disclaimer: The information provided is based on current guidance (at date of publication) from HMRC and may be subject to change. Any advice shared here is intended to inform rather than advise. Taxpayer's circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this information, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.