Once registered for VAT, businesses must now follow the Making Tax Digital (MTD) rules, as detailed in HMRC’s notice 700/22 https://www.gov.uk/government/publications/vat-notice-70022-making-tax-digital-for-vat. Essentially there are three key requirements:
- All records specified must be held digitally.
- The VAT returns must be submitted digitally using HMRC’s API.
- Any transfers of data required to produce the return must be done using digital links.
In theory it’s not impossible to meet the first criteria with a spreadsheet, but there may be considerable work to do to ensure it complies. Unless you’re a computer programmer, you’re unlikely to be able to meet the API submission criteria yourself, but there are off-the-shelf “bridging software” packages available which will take figures from spreadsheets and upload them to HMRC. For the final criteria, consider how data currently gets into your spreadsheet. If you’re just running reports from the various websites and copying/pasting or typing totals in, that’s unlikely to comply. However if (for example) you’re exporting transaction level data in CSV files, which is then being imported to the spreadsheet by an automated macro process, it may comply.
However, I would suggest that it may be better to look into getting some form of small business accounting software. Most of these should be compliant with MTD, and will be kept up-to-date if the requirements change in the future. If they have an accountant, it would be worth asking the accountant to recommend a package. But if they haven’t already got an accountant, it’s worth considering speaking to one – as they’ll be able to go through all aspects of the business and explain the implications.