Symptoms:

When customer is attempting to submit or retrieve Making Tax Digital MTD VAT data to and from HMRC, customer may get a message in the MTD VAT software:

HMRC server has returned an error message: 

The Trader or Agent has not authorised the software to interact with HMRC MTD system. Run VAT Digital Authorisation process again and authorise access for the software. 

This issue is not caused by Andica software, the software is simply relaying the response received from HMRC's server.

Cause:

This message is returned by HMRC when the client or agent is not authorised to submit or request MTD VAT data. 

Business:

• The business has not signed up for Making Tax Digital for VAT (MTD VAT)
  
• HMRC have not completed the sign up process, you will need to wait up to 72 hours for HMRC to confirm
  

Agents:

• The agent has not created an Agent Services Account. This is different to HMRC online services for agents account.
  
• The agent has not linked clients to Agent Services Account
  
• The client has not signed up to MTD
  
• The client has not authorised the agent to act on their behalf
  
• HMRC have not completed the sign up process, you will need to wait up to 72 hours for HMRC to confirm
  

Solution:

HMRC have a process that must be followed to get MTD VAT submissions started.

Before you authorise the software, ensure you have registered with HMRC for MTD VAT and completed their registration process.

Step 1 Register with HMRC:

HMRC have provided VAT sign-up advice for businesses and agents and have produced simple step-by-step guides:

You will need to wait for up to 72 hours for HMRC to confirm that you can submit returns using Making Tax Digital for VAT system.

Step 2 Authorise the software:

Use the VAT Digital Authorisation function within the software to grants the software authority to interact with HMRC. This enables users of software to process submit and retrieve MTD VAT data.

The authorisation expires periodically and must be refreshed. After 18 months the authorisation fully expires and the user must grant authority again.

If the issue persists, you will need to contact HMRC's Online Services helpdesk on 0300 200 3701 and speak with their MTD VAT team to confirm the registration process. We cannot access HMRC systems to check what is wrong within your digital account and the clients MTD VAT registration.