In this week’s article, we outline a step-by-step guide for setting up MTD bridging software for your VAT-registered business. In a few simple steps, you can submit your first VAT Return for free today! Read on below for details.

What is bridging software for MTD?

Bridging software for Making Tax Digital allows users to quickly and conveniently submit their VAT Returns online. HMRC-recognised software providers such as AbraTax achieve this by “bridging” the gap between your Excel spreadsheet (containing your business’s finances) and the VAT system. This is achieved by linking your business’s VAT-relevant data to a bespoke template – all done within Excel.

Benefits of MTD bridging software for VAT

Using Excel bridging software for MTD, there is no need to install new software or share the entirety of your business’s financial details with a third party: only seven Excel cells are linked (with two more automatically generated). The whole process can be finished in a matter of minutes. Furthermore, AbraTax offers new users a free trial, meaning you can submit your first VAT Return for free (with no need for credit or debit card details)!

How to use MTD bridging software for your VAT Return

In just five steps outlined below, you can set up an account and submit your first (free) VAT Return today. It really is as simple as it sounds!

1. Connect your VAT registration

If you haven’t already registered with AbraTax, register now. If you have already registered, log in. Once logged in, select “Add New VAT Registration” and insert your business’s registration name and VAT number:

Cursor highlighting "Add" on the "Add New VAT Registration" window

After clicking “Add”, click “Grant AbraTax Access”:

Cursor selecting "Grant AbraTax Access"

Sign in using Government Gateway to grant AbraTax permission to submit your VAT Returns:

Partial screenshot of "Sign in using Government Gateway" login page

Congratulations: you’re now registered and good to go!

2. Download the Excel template

From your dashboard, download AbraTax’s MTD for VAT Excel template (it can be found by clicking “File Return”). Setting it up in your spreadsheet is super quick:

  • Open your business’s financial spreadsheet (“working file”).
  • Open the MTD template in a separate Excel window.
  • Drag and drop the template tab into your working file.
Dragging an Excel tab from AbraTax template to your working file spreadsheet

By dragging the template over, this will insert it as a new tab alongside your working spreadsheet. You’re now ready to link up the required cells.

3. Digitally link the Excel cells

You need to create seven digital links between your working file spreadsheet and the template. In doing so, two additional cells in the template will automatically be calculated. Creating digital links is simple:

  • Open the template tab.
  • Type “=” in the relevant cell under “Value”.
  • Open the working spreadsheet tab.
  • Click on the corresponding cell to link it to the template.
Creating a digital link between your working file spreadsheet and the newly inserted template

After linking “Box 1”, continue linking the other boxes in the template with their corresponding working file cells. Note that “Box 3” and “Box 5” will be filled in automatically by the template.

4. Export your filled-in template

Once your template looks complete with nine pieces of data, it should be ready to export and submit! Right-click the template tab and select “Move or Copy…”. In the “To book” drop-down list, select “(new book)” and click “OK”.

Flowchart depicting the process of generating a new book containing the filled-in template

This will re-open your completed template in a separate Excel window. Next, export it as a .csv file through “File” -> “Save As”.

Make sure to select “CSV (Comma delineated) (*.csv)” in the filetype drop-down list before hitting “Save":

Saving the new book as a .csv file

Now you’re ready you submit your VAT Return!

5. Submit your VAT Return

To submit your VAT Return, simply re-open your AbraTax dashboard and click on “File Return”. Drag and drop your newly exported template into the on-screen upload box.

A summary will appear, where you can check that the details all look correct. When you’re ready to submit, select “Submit Return” -> “File with HMRC”.

Successful VAT Return message (with example HMRC receipt ID)

Congratulations – your VAT Return is successfully submitted! You will receive an instant HMRC receipt ID on-screen as confirmation.

If you're ready to start your free trial, register or log in with AbraTax now.

Disclaimer: We aim to offer educational articles on our blog, focusing on tax-related topics. However, it's important to note that over time, the relevancy of this content might diminish, and we cannot guarantee accuracy. While these articles serve as a tool for enhancing tax knowledge, they are not a replacement for expert advice in accounting, taxation, or legal matters, given the unique nature of each individual's situation. Should you require personalized assistance, we encourage contacting HM Revenue and Customs (HMRC).