HMRC defines this as a data transfer or exchange within and between software programs, applications or products that make up functional compatible software. This must be digital where the information continues to form part of the digital records.
A digital link is an electronic or digital transfer or exchange of data between software programs, products or applications. The use of ‘cut and paste’ does not constitute a digital link.
Further details are contained in regulations (The Value Added Tax (Amendment) Regulations 2018 (2018/261)) and VAT Notice, which is now available.
For more about MTD please see our other FAQ’s on Making Tax Digital