09 Nov 2018HMRC recently started to send out so-called 'encouragement letters' to businesses within the scope of Making Tax Digital for VAT (MTD for VAT). The letters are being sent to 200,000 businesses which are eligible to join the current MTD for VAT pilot. According to reports, HMRC is also sending letters to some VAT-registered businesses with a turnover just below the VAT registration threshold. However, the letters will not be sent to firms' agents. The letters are being sent out in two waves. As part of the first wave, 20,000 letters were sent this week: a further 180,000 letters are set to be sent by HMRC during the week commencing 12 November. Two versions of the letter are being used. The first version of the letter explains the changes to the way in which firms 'keep VAT records and submit their VAT returns to HMRC' under MTD for VAT. The second version will be a shorter letter, and will supply businesses with advice on how to prepare for the introduction of MTD for VAT in April 2019. HMRC stated that it is 'committed to writing to everyone within the scope of MTD for VAT', and that it aims to accomplish this by the end of November.