Last week both QuickBooks Online (QBO) and Xero announced that they have added bridging software to their online cloud accounting solutions.

At first sight this looks like a strange decision.

Both systems are MTD-ready for filing VAT returns after the 1^st April deadline, so why offer a bridging solution?

The answer is that both firms have been disappointed by the number of sign-ups to their full digital accounting platforms. Since HMRC announced that spreadsheets would still be an acceptable way to keep digital records, businesses using spreadsheets breathed a sigh of relief. There was no need for them to move to the more expensive cloud-based software – but they would need bridging software to be fully MTD compliant.

Hence QBO and Xero needed to be in that market or risk losing out on the businesses that aren’t yet ready for a full cloud accounting solution but will upgrade in the future.

Your accountant or bookkeeper will already have told you whether MTD for VAT will affect your business; if you will need bridging software you now have even more choice and it is likely that your accountant already supports QBO, Xero or both.

If you are unsure whether or how MTD will affect your business all the information you’ll need is here or you can book a call with me.

 

Noel Guilford