While MTD for VAT first became compulsory in April 2019 for businesses above the VAT threshold (currently £85,000), it was extended in April this year to include all VAT registered businesses, regardless of their turnover. 

All VAT registered businesses are therefore now within the scope of MTD for VAT, unless HMRC have agreed they are exempt. However, a number of them have still not signed up, and instead continue to file their VAT returns through their VAT online account (often referred to as the ‘VAT portal’).  

To encourage these remaining businesses to sign up, HMRC have announced that the VAT portal will be closing from 1 November 2022.  From this date, businesses will no longer be able to use the VAT portal to file their returns, subject to the following limited exceptions:

• Where HMRC have agreed that a business is exempt from MTD for VAT, they can continue to use the portal.
• Businesses with turnover below the VAT threshold who are due to file a VAT return by 7 November can use the portal for that return only.
• Businesses filing annual VAT returns can use the portal until 15 May 2023.

All other businesses need to either sign up for MTD for VAT and acquire compatible software, or apply for an exemption as soon as possible.