Microsoft and Making Tax Digital (MTD)

Microsoft Dynamics 365 F&O and Making Tax Digital (MTD)

Clearly those customers who have signed up to Microsoft Dynamics 365 for Finance and Operations (D365 F&O) will be provided with an inclusive upgrade as part of the software.

Microsoft have released the following confirmation via Lifecycle Service (LCS)

3977448UK – VAT Statement submission changes (Making Tax Digital from April 2019) – Dynamics 365 for Finance and Operations (7.3)

Product and version: Dynamics 365 for Finance and Operations

Release: 7.3

Planned release date: 2019 Q1

Category: Planned features

Feature Reference: GB-00005


From April 2019, HMRC is launching the Making Tax Digital (MTD) initiative. Under the new system every UK VAT registered business will be required to submit their VAT returns digitally to HMRC, without any manual intervention.

Customers and Partners will be advised when the release is timed nearer the time and we will advise our customers as soon as we get a confirmation.

Dynamics 365 - Making Tax Digital (MTD)

Microsoft Dynamics AX2012 R3 and Making Tax Digital (MTD)

For those customer still on Dynamics AX 2012R3, and there are many, who have paid their annual BREP, then Microsoft, as above will release a new version of 2012 R3 to comply with the MTD requirements in Q1 of 2019. Again, we will advise our customers as and when we have an update on this.

Microsoft Dynamics AX (older versions) and Making Tax Digital (MTD)

Anything from Dynamics AX 2012 R2 and earlier is no longer supported and the upgrade for the MTD requirements will not be provided by Microsoft.

What options are available to customers on unsupported versions?

There are a couple of options.

Obviously do nothing is still an option, but one that is likely to bring down the wrath of HMRC and an appropriate fine.

As such there are two more practical options available: –

Upgrade:- To those customers on AX 2012R1 or R2 there is probably still, just about enough time to do what is a relatively small upgrade, although that will depend on the developments and configuration.

Develop an add-on:- Various suggestions have been made around waiting for Microsoft to release their product then backward integrate to earlier versions. However, as we are not sure when this will be released and the integrations to AX 2009 and earlier may not be as simple due to the major changes in finance structure between these version, we would not recommend this to be a viable option.

Annata (ibrl) have decided not to wait and have developed a version for Dynamics AX2009. We will be making this available at a small cost to our clients and are happy to talk to other businesses who may be on this version about how they can benefit if they are having trouble getting a solution.


Get in touch today to find out about our solutions for Making Tax Digital: