Making Tax Digital (MTD) for VAT: why you need to update your SAP ERP system as from 1st April 2021
VAT periods beginning on or after 1st April 2021 must be submitted via MTD.
With their Making Tax Digital (MTD) initiative, HMRC (His Majesty’s Revenue and Customs – UK tax authorities) have set their intentions to become one of the most advanced tax authorities in the world by enhancing the customer experience whilst also closing the tax gap.
The primary aim of Making Tax Digital is to make tax administration more effective, efficient, and easier for taxpayers through the implementation of a fully digitalised tax system by 2021, whilst also reducing HMRC’s overheads for managing tax affairs.
From April 1, 2022, ALL companies that generate taxable sales in Great Britain are obliged to submit sales tax returns via a “digital link” to the tax authority HMRC. The previous sales threshold of £85,000 will no longer apply!
From a practical point of view, MTD for VAT requires businesses to keep digital records and accounts, which needs to be digitally linked – including all data transfer or exchange within and between software and applications. MTD mandates the use of functional compatible software, such as SAP ERP, to meet these requirements that must connect to the HMRC systems through APIs (Application Programming Interfaces). In order to comply with this mandatory requirement, PIKON have developed their “Integrated MTD-VAT Connector” for SAP.
System-Demo & Quotation
Request a web-meeting with a demo and we will explain you our approach to make your SAP ERP system MTD compliant with our solution “Integrated MTD-VAT Connector for SAP”.
Overview of the Integrated MTD-VAT Connector for SAP:
- On-premise installation, no interaction with cloud-based services
- Self-contained SAP Add-On – does not interfere with existing programs/ processes
- Developed in PIKON’s own Namespace /pikon/
- Web Dynpro or SAP GUI interface
- Simple transmitting of the data
- Uses existing VAT bookings to calculate the VAT returns
- Transparent reporting of all sending processes
- Utilises standard SAP communication processes to submit data to the HMRC MTD platform
- Supports various network topologies (e.g. communication via a Gateway server)
- Easy implementation through an SAP transport file
- PIKON is responsible for maintaining the SAP Add-On – MTD compliance in the long run
- No additional SAP licenses required
How PIKON’s Integrated MTD-VAT Connector for SAP makes your SAP ERP system compliant with the new MTD for VAT regulations
The Integrated MTD-VAT Connector for SAP calculates and submits VAT returns directly from SAP ERP (either SAP ECC or SAP S/4HANA) to HMRC via a digital link to the MTD platform. Because of that, it ensures a seamless digital journey for your UK VAT fillings and runs over SAP ERP as an end-to-end solution. This solution is fully integrated in SAP without an external interface or use of external software and SAP ERP release independent. It contains user-friendly screens, owns customised tables and owns transaction codes and menus.
- Selection of the relevant data from your accounts and calculation of the required figures for the “9 box” return
- Presentation of the figures to be submitted together with the standard HMRC declaration confirmation
- Submission of the figures to the HMRC MTD platform
- Logging of the results for future reference (e.g. username, time of submission, values submitted, submission confirmation reference from HMRC etc.)
For more information about PIKON’s MTD solution, or if you would like to arrange a web meeting including a system-demo with our MTD team to discuss how PIKON can help you to fulfil your MTD obligations with SAP, please fill out the form: