ONLY seven per cent of businesses in the North West have so far signed up to submit digital VAT returns – before its introduction from April.

More than 2,000 businesses in the North West have signed up early to the new Making Tax Digital service. HMRC says the system will reduce the time companies spend on administration in the longer term and make it easier for them to get their tax right.

For VAT periods from 1 April most businesses above the VAT threshold will need to keep their records digitally and submit their VAT return using MTD-compatible software.

HMRC has written to every business that will be mandated with information on what they should do and how.

Theresa Middleton, Director of the Making Tax Digital for Business Programme, said: “There is under a month to go before the introduction of Making Tax Digital. I’d urge businesses to get ready now. There are over 200 software products for businesses to choose from with a range of prices, including some that are free, offering different levels of functionality to suit every business. ”

Accountants will already be aware of MTD and will advise businesses how and when they need to make changes to be ready for the new service.

Those already using software will simply need to ensure it is MTD-compatible then sign up to the new service and authorise their software for MTD. For those who are not using an accountant or don’t use software, HMRC says it is quick and easy to sign-up.

GOV.UK webpages provide information on a wide variety of products, from free software for businesses with more straightforward tax affairs, to increasingly sophisticated paid solutions. There are also products that can be used alongside a spreadsheet for those businesses who don’t want to change their underlying record-keeping system.