Skip links

UK warns 1.1million taxpayers on 1 April 2022 MTD changes

Voluntary VAT registered business liable to Making Tax Digital for VAT bookkeeping, digital links and API filing requirements

From 1 April 2022, all VAT registered businesses are mandated to follow the UK’s requirements on digital recording and reporting Value Added Tax details.  This means for the first time, any business which is below the UK VAT registration threshold of £85,000 but has elected to voluntarily VAT register will now be subject to MTD for VAT requirements.

Affected businesses will have to register with HMRC for MTD returns filing by at least 5 days after their last return deadline, and no less than 7 days before their first MTD for VAT return deadline.  This will likely oblige many hundreds of thousands of micro-businesses to invest in accounting software or API-enabled bridging spreadsheets for the first time, or just upgrade, to comply with the requirement to have an uninterrupted digital journey from invoice to VAT return. There is no allowance for manual bookkeeping or data manipulation.

MTD for VAT is the UK’s first stage of digitising tax reporting and will be rolled out to other taxes in the next few years, including Income Tax in April 2024.

To receive our free global VAT and GST news updates, sign-up here.

MTD for VAT roll out

HMRC rolled out its MTD for VAT programme in three stages:

  • April 2019 – mandated VAT registered business to file their regular return via the new API portal
  • April 2021 – digital bookkeeping and digital links requirements introduced. At the same time, MTD for VAT requirements became subject to regular VAT penalty regime. This measure was originally scheduled for April 2020, but was delayed due to the COVID-19 pandemic.
  • April 2022 – all voluntarily VAT registered business below the VAT registration threshold of £85,000 must also comply with the above requirements.

Some VAT-registered businesses may be eligible for an exemption from Making Tax Digital, if it is not reasonable or practicable for them to use digital tools for their tax. If a business has previously been granted an exemption for VAT online filing, this will carry over to Making Tax Digital VAT requirements.

Europe e-invoicing and live reporting

Country Date Comments (click for details)
EU e-invoice proposals 2030? Digital reporting and e-invoicing harmonisation
Albania Jan 2021 Authorised e-invoice software and pre-clearance
Belgium Jan 2026 Phased introduction of B2B e-invoices
Bulgaria TBC Public consultation on pre-clearance model e-invoice
Croatia Jan 2026 B2B mandatory e-invoicing
Denmark 2024 Digital record keeping obligations
Estonia 2025 Suppliers must offer customers e-invoicing option
Finland Apr 2020 Customer option to require B2B e-invoices
France Sep 2026 E-invoicing and e-reporting for B2B and B2C
Germany Jan 2027 B2B mandatory e-invoicing proposals
Greece 2025 e-invoicing based on exiting myDATA digital reporting
Hungary Jul 2018 RTIR live invoice reporting. No govt pre-clearance required
Jan 2024 eVAT pre-filled returns based on live invoice reporting
Italy Jan 2019 Micro businesses join SdI e-invoicing Jan 2024
Ireland TBC Public consultation underway
Latvia 2025 B2B e-invoices based on PEPPOL
Lithuania ? E-invoicing platform being scoped
Montenegro TBC B2B mandatory e-invoicing preparations
Netherlands No mandate planned Unlikely to adopt domestic reforms
Poland 2025 B2B mandated e-invoicing
Portugal Jan 2024 Certified invoicing software for non-residents
Jan 2024 ATCUD digital invoice signature for non-residents
Romania Jul 2024 RO e-invoicing implementation
Russia TBC Extension of Traceability Model to B2B on hold
Serbia Jan 2023 B2B e-invoicing
Slovakia 2025 B2B and B2C e-invoice rollout
Slovenia 2025 ? e-SLOG B2B proposal stalled
Spain 1 Jul 2017 SII live invoice and book reporting
Spain 2 Jul 2025 Pre-clearance B2B e-invoices; supplement to SII
Sweden TBC PEPPOL based mandatory e-invoicing
Turkey Jan 2014 e-invoice e-Fatura and e-Arşiv
UK Apr 2022 MTD for VAT extended to 1.1million taxpayers

Newsletter

Get our latest news right in your mailbox