MTD (Making Tax Digital) submission error in Sage 50 Accounts

While submitting the VAT Return under the MTD government program, an error occurs. The following Sage 50 MTD submission error message is displayed:

“An error has occurred when communicating with the submission service. Please try again later.”

Choose “Details” to check the error message:

• “Error 403 – The client and/or agent isn’t authorised.”
• “Error 403 – The client and/or agent isn’t authorised.”

This issue can arise for multiple reasons. The reason depends on whether the MTD (Making Tax Digital) submission is for a business or for a client’s VAT Return filing.

This guide outlines the common reasons this issue occurs. The following section includes the steps to fix this issue and other factors to consider while resolving an MTD or Sage 50 VAT submission error.

What is a Sage 50 MTD Submission Error?

MTD is HMRC’s system for managing tax records and making electronic tax submissions. Sage 50 links with HMRC to recover VAT duties, create VAT returns, and file completed returns.

A Sage 50 MTD submission issue arises when the software fails to complete a VAT return submission to HMRC. Other reasons include HMRC rejecting the submission or a connection disruption.

When the submission is not complete, Sage 50 displays the error message. Inspect the issue quickly and verify that HMRC received the VAT return before filing the taxes.

Note: Completing a Sage 50 VAT return does not guarantee that the return is submitted to HMRC.

Why is My Sage 50 MTD Submission Failing?

A Sage 50 submission under MTD occurs when submission is rejected due to a failure of HMRC. Here is the list of the common reasons that trigger the error:

Note: The issue can indicate problems with HMRC authorization, VAT tenure, VAT data, and Sage services. Review the specific error code before implementing a solution.

• Outdated HMRC Validation
  Sage 50 requires certified HMRC approval for MTD submissions. Outdated or cancelled authorization can restrict submissions.
• Inaccurate VAT Information
  The VAT registration and MTD information should align with HMRC records. Wrong information can trigger issues leading to the Sage 50 VAT submission error.
• Inaccurate Transactions or VAT Codes
  Inaccurate VAT codes can impact VAT numbers. Review the entries before the final submission.
• Inaccurate VAT Period
  The Sage 50 VAT period must align with the HMRC regulations. A closed or wrong period can give rise to this issue.
• Older Sage 50 Software
  Update the Sage 50 software before requesting a return. An older software version is not compatible with the latest MTD services.
• Network or Internet Connectivity Issues
  Connectivity issues can disrupt communication with HMRC. Antivirus or firewall settings may restrict access.
• HMRC Service Problems
  HMRC service or maintenance requirements can postpone submissions.
• Accounting Data Problems
  Unavailable data, inaccurate VAT entries, or repeated entries can impact the return. Check the return before completing the submission.

How to Fix Sage 50 MTD Submission Errors?

Sage reviews VAT information before the VAT return is submitted via MTD. Incorrect information or a connection issue can prevent the submission. Review the error message and then complete the steps shared below:

Step 1: VAT Registration Number is not valid

The VAT registration number in Sage does not align with HMRC. Here is the error message:

Follow these steps to resolve the invalid VAT Registration Number issue. Once resolved, directly update the VAT registration number in the module:

Sage 200 Professional

• Access the “Accounting System Manager”.
• Choose the “Settings” option.
• Click the “Company Details” tab.
• Access the “VAT” tab and review the number in the “VAT Reg”.
• Check it against the HMRC records.
• Input the correct number.
• Choose the “OK” button.
• Now reattempt the MTD submission via Sage 50.

Sage 200 Standard or Education

• Navigate to the “Settings” option.
• Click the “Organization and Financial” option.
• Now, click the “Company Details” tab.
• Locate the VAT registration number.
• Check it against the HMRC records.
• Rectify the number if required.
• Now, retry the Sage 50 Making Tax Digital submission

Note: Get in touch with HMRC when the VAT registration details cannot be verified.

Step 2: VAT Return Submission is already Complete

When a user attempts to submit a VAT return already acquired by HMRC, an error occurs. Here is the Sage 50 VAT submission error message:

• Error: “User has already submitted a VAT Return for the given period.”
• Follow these steps in the given order to resolve this issue:
• Review the VAT accounting period in Sage.
• Check it against the HMRC reporting period.
• Review whether the VAT return is accepted by HMRC.
• Review for any adjustment requirements.
• Record any accepted changes in the right VAT period.
• Get in touch with HMRC for further help.

Note: Never resubmit the same VAT Return till HMMRC verifies its status.

Step 3: Sage Cannot Communicate with the Submission Service

Sage requires the accurate HMRC authorization for VAT Return submission. In the absence of the authorization, the following error message is displayed:

“The client and/or agent is not authorised.”

Here are the steps to resolve this issue:

• Review the HMRC authorization information.
• Verify that the business is set up for MTD.
• Finish any pending HMRC registration.
• Allow HMRC to verify the registration.
• Go back to Sage and reattempt the VAT submission.

Step 4: Unanticipated Error When Connecting with the Submission Service

When Sage loses connection with HMRC due to poor internet service, the following error occurs:

Error: “Object reference not set to an instance of an object.”

Here are the steps to resolve this issue:

• Review the internet network.
• Ensure the connection is strong.
• Exit the Sage application and start Sage again.
• Reattempt VAT submission. Use a different system if the issue persists.
• When the internet connection is steady, resubmit the VAT return.

Steps to Review the Sage 50 MTD Settings

Sage 50 uses the MTD settings to submit VAT details to HMRC. Inaccurate settings can give rise to Sage 50 submission issues. Incorrect settings can stop Sage 50 from acquiring VAT obligations or completing VAT Return submission.

Sage 50 uses these settings to transfer VAT details to HMRC. Hence, it is crucial to check the Sage 50 MTD settings before proceeding further. Follow these steps to check the settings:

Step 1: Use the VAT configurations.

• Choose the “Settings” option.
• Choose the “Company Preferences” tab.
• Click the “VAT” tab.

Step 2: Review the VAT Registration Number

• Find the “VAT Reg” field.
• Check the VAT registration number.
• Check the number against the HMRC records.
• Rectify the number when needed.

Step 3: Review the Non-Vatable Tax Code

• Find the “Non-Vatable Tax Code” section.
• Verify the chosen tax code.
• Sage 50 integrates T9 as the default code.
• Verify that this code is not displayed on the VAT Return.
• Check the VAT Return setup when needed.

Step 4: Review the VAT Structure

• Find the “VAT Scheme” setting.
• Verify that the chosen scheme aligns with the business structure.
• Check the present schemes:
• VAT Cash Accounting
• Standard VAT
• Flat Rate – Invoice Based
• Flat Rate – Cash Based
• Choose the appropriate scheme.

Step 5: Review the Flat Rate Percentage

• Find the “Flat Rate” setting.
• Check the percentage.
• Check the percentage with the HMRC-verified rate.
• Add the right percentage.

Note: Ensure you finish this step when the business integrates a Flat Rate VAT scheme

Step 6: Register for Making Tax Digital for VAT

• Find “Enable Making Tax Digital for VAT submissions.”
• Select the checkbox before the initial MTD submission.
• Verify that Sage 50 can link with HMRC.

Step 7: Review the HMRC Payment Information

Note: Perform this step when VAT payment requires Sage e-banking.

• Find the “HMRC Payments” field.
• Check the HMRC bank account information.
• Verify that the information is correct.

Step 8: Save and Retry the Submission

• Check all the VAT settings.
• Verify that the data is accurate.
• Choose the “OK” button to save the changes.
• Retry the MTD submission through Sage 50

Note: Check the MTD and VAT settings before reattempting the submission to avoid a Sage 50 VAT submission error.

Steps to Reconnect Sage 50 to HMRC

Sage 50 needs certified HMRC validation for MTD VAT submissions. Connect HMRC with Sage 50 when the authorization expires, or when Sage shows the Sage 50 HMRC Error 403.

Follow these steps to connect Sage 50 to HMRC again:

1. Renew authorization from the VAT Return message

• Go to the VAT Return section and find the verification message.
• Choose the “Reconnect” option.
• Choose the “Authenticate” option.
• Choose the “Continue” option on the HMRC window.
• Enter the Government ID and Password.
• Choose the “Grant Authority” tab.
• Go back to Sage 50 and verify the connection message.

2. Authorize from Settings again

• Navigate to the “More” option.
• Choose the “Business Settings” option.
• Click the “Accounting Dates & VAT” option.
• Find the “Making Tax Digital” segment.
• Choose the “Reconnect” option.
• Click the “Authenticate” option.
• Click the “Continue” button.
• Add the Government Gateway login details.
• Choose the “Grant Authority” option.
• Go back to Sage 50 and verify the connection status.

Note: Sage allows VAT Return to have a Draft, Failed, or Waiting status; however, MTD adjustments are denied. Hence, erase or submit the return first, and then recreate the VAT Return after reconnecting.

To erase a draft VAT Return, follow these steps:

• Navigate to the “More” option.
• Choose the “VAT Returns” option.
• Choose the appropriate return.
• Choose the “Delete” option.
• Verify the deletion.

How to Check the VAT Return Before Submission in Sage

Before submitting a VAT return via Sage 50, review the essential details. Verify the VAT return period, VAT number, figures, MTD validation, and submission progress.

Follow these steps to review the VAT Return before submission:

1. Review the VAT Registration Number

Ensure the VAT Registration Number in Sage 50 aligns with HMRC records. An inaccurate or missing VAT Registration Number can hinder the submission.

2. Review the VAT Reporting Period

• Choose the right VAT obligation period. The period may have ended before the return is submitted.
• Review the VAT settings, VRN, and regional configuration when Sage 50 displays the incorrect period.
• Update Sage 50 to a more compatible version.

3. Check the VAT Numbers

• Verify the VAT figures with the accounting requirements.
• Review the VAT accumulated, VAT recovered, and other appropriate boxes.
• Rectify any issues before the return is submitted.

4. Review the MTD Authorisation

• Ensure Sage 50 links to the appropriate HMRC VAT account.
• Verify that the MTD authorization is enabled.
• Connect to HMRC again and finish the authorization procedure when Sage shows a communication issue.

5. Verify that the Return is not Already Submitted

• Review the HMRC VAT account before making the final submission.
• Ensure that HMRC has not received a return for the chosen period.
• Do not submit the return twice.

6. Check the Submission Issues

Review any error or warning message that Sage 50 shows. Common issues include:

• Error 400: There is a temporary problem with the request or service. Try again later.
• Error 403: Sage 50 is not authorised to connect to HMRC. Check your HMRC authorisation settings.
• TAX_PERIOD_NOT_ENDED: The VAT period has not finished yet. You cannot submit the VAT return until the period has ended.
• The VRN specified was not found: HMRC cannot find or match your VAT Registration Number (VRN). Check that the VRN is correct.
• The user has already submitted a VAT Return for the given period: The VAT return has already been submitted to HMRC. Do not submit it again.
• The Organizations/VAT API is currently unavailable: HMRC’s VAT service is temporarily unavailable. Wait and try again later.

7. Review the Sage 50 Version and Connection

Access a Sage 50 version that is compatible with MTD submissions and helps prevent Sage 50 VAT submission errors.

• Verify the internet connectivity when Sage 50 fails to connect with HMRC.
• Review the HMRC VAT account when Sage 50 displays a communication or server issue. The VAT return may be received by HMRC.

8. File the VAT Return

• File the VAT Return via Sage 50 once the following is verified:
• MTD authorisation
• VAT obligation period
• VAT figures
• VAT registration number
• Submission status
• Save the submission verification and compatible VAT records.
• Check the return before making a final submission to avoid incorrect periods, figures, or repeated submission.

What to do When HMRC Rejects a Sage Payroll Submission?

Detect the precise issue before adjusting the payroll details using the following steps:

1. Check the unsuccessful submission

• Access the unsuccessful RTI submission in Sage Payroll.
• Choose the option to check or fix the submission.
• Record the error message and number.
• Identify the information that needs rectification.

Note: Authentication issues need login details review. However, employee-data issues need employee record rectifications.

2. Check the Government Gateway Details

Incorrect authentication can give rise to the Sage 50 HMRC Error 403. Follow these steps to review the Government Gateway details:

• Sign in to the relevant HMRC service.
• Confirm the Government Gateway details.
• Confirm the PAYE service is active.
• Verify the Employee PAYE reference in Sage Payroll.
• Check the Accounts Office reference.
• Confirm the HMRC account status before the resubmission.

3. Confirm the Employer Details

HMRC and Sage Payroll should include relevant employer details. Follow these steps to verify the employer information:

• Access the employer details in Sage Payroll.
• Review the Employer PAYE reference.
• Review the Accounts Office reference.
• Validate the recorded business name.
• Review the business address.
• Check the payroll scheme information.
• Adjust the inaccurate details.
• Update the inaccurate details.
• Save the changes.
• Check the data before the RTI Return is resubmitted.

4. Review the Employee Details

Inaccurate employee information can lead to unsuccessful FPS submission. Follow these steps to check the employee details:

• Access the impacted employee record.
• Verify the full name of the employee.
• Confirm the birth date.
• Confirm the National Insurance number.
• Validate the postcode and address.
• Review the employment start date.
• Check the leaving date.
• Confirm the National Insurance group.
• Review the tax code.
• Verify the payroll status.
• Erase unwanted spaces and incompatible special characters.
• Save the verified details.
• Finish all the needed employee fields before final resubmission.

5. Check National Insurance Category Details

The accurate National Insurance category is compatible with precise RTI reporting and payroll computations. Follow these steps to review the NI category information:

• Access the impacted employee record.
• Check the allocated NI category.
• Check the category against the employee status.
• Review the relevant HMRC rules.
• Rectify the category when needed.
• Complete the relevant HMRC correction procedure.
• Do not alter historical payroll records without checking the relevant correction requirements.

6. Review the Payment Date and Payroll Period

The Full Payment Submission should include the right payroll period and payment date. Follow these steps to check the date and period:

• Access the impacted payroll record.
• Review the payment date.
• Confirm the pay period.
• Verify the tax year.
• Check the year-to-date numbers.
• Review the leaving status of the employee.
• Check the latest FPS submissions.
• Rectify incorrect data via the relevant payroll reporting process.

7. Review the HMRC Service Status

HMRC services can experience sudden interruptions. Follow these steps to check the HMRC service status:

• Review the HMRC service status.
• Verify that the appropriate service is present.
• Check the Sage issue message once more.
• Reattempt the submission when the service is available.
• Do not modify valid payroll details when the service is disrupted.

8. Review the Sage Payroll Updates

Access the current compatible Sage Payroll version prior to payroll processing. Follow these steps to check the Sage payroll updates:

• In Sage Payroll, look for software updates.
• Install the relevant update.
• Reboot the Sage Payroll application.
• Check the unsuccessful submission once more.
• Submit the FPS again when the software is set.

9. Retry a Failed FPS Submission

Rectify the detected issue before FPS resubmission. Follow these steps to reattempt a failed FPS submission:

• Access the unsuccessful RTI submission.
• Check the error notification.
• Rectify the impacted details.
• Update the login details when needed.
• Check the payroll information.
• Choose the “Resubmission” option.
• Resubmit the FPS and verify that HMRC acknowledged the submission.
• Save the submission verification for the records.

Conclusion

In this guide, complete information on how to manage the Sage 50 MTD submission error has been shared. For convenience, additional details related to the error have been shared.

Still, if there are any further queries or doubts, feel free to reach out to our Sage experts.

Frequently Asked Questions