Is Dynamics GP compliant with Making Tax Digital?

As I begin my fourth month as an Account Manager at m-hance and continue to introduce myself to my customers, one subject that keeps coming up in conversation is what is the current state of play with Microsoft Dynamics GP and HMRC’s Making Tax Digital programme? Microsoft has been slower out of the blocks than others in terms of clarifying this, but it appears we now have a clear roadmap.

What are the timescales for Making Tax Digital (MTD)?

Firstly, be aware that MTD isn’t a single deadline from HMRC, but rather a phased approach to the electronic automation of submissions which stretches into 2020. HMRC has different phases planned for future roll out, so it’s important to make sure that the software you are using is compliant.


It is the responsibility of the software author to ensure compliance throughout these phases, so if you are on an MTD compliant version of recent releases of Microsoft Dynamics GP, it will be Microsoft who will maintain that compliance on your behalf.

I can’t stress enough how important it is to be on an MTD compliant software release as soon as possible.

Is Dynamics GP compliant with Making Tax Digital

What is Making Tax Digital?

In April 2019, that’s only 6 months away, Phase 1 starts. The majority of VAT registered businesses with a turnover exceeding £85,000 are required to submit VAT Returns using Making Tax Digital (MTD)-compatible software for VAT periods starting on or after 1 April 2019. This basically means a submission in an electronic format defined by HMRC. Some organisations (such as some smaller NfPs) have until October 2019 to be ready.

The first stage of the MTD process is to ensure that you keep and preserve your income and outgoings on functionally compatible software. So, if you are using Microsoft Dynamics GP today you are part of the way there, as you should already be recording this information within the system.

Secondly, and where it becomes a little more complicated, is HMRC requires that you must be able to submit this financial data to HMRC using its digital submission platform. Which in English means the software you use must be able to communicate with HMRC’s own systems (by sending information to HMRC through their defined web services).

Seems simple?

How MTD compliant is Microsoft Dynamics GP?

Microsoft has announced that they will be producing a release for Microsoft Dynamics GP2016 and GP2018 that will be MTD compliant. If you are currently on GP2016 or GP2018, you need to be on the MTD capable versions of these releases.

When Microsoft brings out a Service Pack for MTD, it is likely that you’re going to need assistance to load this from your Microsoft partner, which will incur a cost and you could also encounter some downtime during its application.

Start a discussion today with your Microsoft Dynamics GP partner. For our customers, we’re anticipating these MTD releases in December and can schedule in your upgrade accordingly.

If you are currently on an older version of Microsoft Dynamics GP then you should seriously consider upgrading to a supported version before the April 2019 deadline. There are, of course, many other benefits of upgrading over and above MTD compliance.

Is Microsoft GP compliant with Making Tax Digital?

MTD for VAT for Dynamics GP from m-hance

What about the rest of us who aren’t on an MTD compliant release and don’t have the time, budget or resource to upgrade between now and April?

Here at m-hance, we are completing development of our own MTD for VAT solution for most older versions of GP, one that is fully integrated within Dynamics GP. Being built within GP, it presents a familiar and user-friendly interface.

Don’t let MTD creep up on you!

Don’t put it off, don’t delay, get your MTD plan in place as quickly as possible so when April arrives your Microsoft Dynamics GP system is ready for the new legislation.

Article by:
Matt Fleming
Microsoft Dynamics Account Manager