VAT returns for those clients have historically been prepared based on the supplier statements ( often a monthly summary), rather than the individual invoices. However, the concern until now has been that the MTD requirement relating to digital record keeping of supplies received required each supply received to be recorded individually – an exceptionally onerous task.
The good news is that HMRC have recently updated the MTD VAT Notice 700/22, and this point is now specifically covered in paragraph 4.3.3.1. The update advises that while it remains HMRC’s view that best practice would be to digitally record the individual supplies, to manage the risk of missed or duplicated entries, they accept that additional work for a business in capturing individual supplies digitally could in itself lead to data entry errors. On this basis, HMRC advises they can accept the recording of totals from a supplier statement where all the supplies on the statement relate to the same VAT period and the total VAT charged at each rate is shown. If a business does choose this option, they are also required to cross-reference all supplies on the supplier statement to invoices received, but HMRC goes on to confirm this can be done outside of the digital records.
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