Making tax digital
Discussion
johnhemming said:
Eric Mc said:
Still a heck of a lot more work for many people.
That depends on how efficient people's processes are. The submissions don't have to take a long time. Overall there is no reason for it to take longer than it does now. And for quite a few it means way more than five times.
Eric Mc said:
Five submissions a year compared to one at the moment means more work unless you can somehow conceive that doing something five times is easier than just doing it once.
And for quite a few it means way more than five times.
It does, however, depend upon how long the individual process takes. In the end I have experience in handling MTD ITSA. It will depend to a great extent on the efficiency of the associated processes. And for quite a few it means way more than five times.
Eric Mc said:
Five submissions a year compared to one at the moment means more work unless you can somehow conceive that doing something five times is easier than just doing it once.
And for quite a few it means way more than five times.
I just can't see the point of it. I accept that HMRC must somehow think this will reduce errors and also increase tax take, (why else would they do it?), but IMO they are wrong. And for quite a few it means way more than five times.
Tradesmen, for example, will still do cash jobs. These jobs obviously don't make it into their books now, and they won't under MTD either! Of course, one sure fire way of preventing this type of tax evasion would be to get rid of cash altogether, but I doubt that would be a vote winner.
johnhemming said:
It does, however, depend upon how long the individual process takes. In the end I have experience in handling MTD ITSA. It will depend to a great extent on the efficiency of the associated processes.
You are living in fantasy land. In the REAL world, carpenters, brickies, plumbers, shoe shop owners, etc etc will not have the interest or inclination for jumping through complicated and time wasting hoops to satisfy some indeterminate wish of Whitehall bureaucrats.They have real lives to live and real work to do.
This initiative failed on its first attempted launch. It is doomed to fail again.
Eric Mc said:
In the REAL world, carpenters, ....
Oddly enough one of my real world MTD ITSA accounts is in fact a carpenter.There are, however, real process issues that accountants for example need to look at. For example whether they need a client sign off on every submissions or whether actually they only need that for the final crystalisation that agrees the full submission.
And some..
Does HMRC not really understand that the information they receive each quarter will be largely junk data and of no earthly use to them?
What are they proposing to do with this data?
It is a harebrained, dumb scheme and it deserves to fall over - like it has done once already.
Does HMRC not really understand that the information they receive each quarter will be largely junk data and of no earthly use to them?
What are they proposing to do with this data?
It is a harebrained, dumb scheme and it deserves to fall over - like it has done once already.
The idea of Digital Tax is to have an electronic audit trail. There are two main flavours of this SAF-T which involves sending all transactions to the tax authorities and MTD which involves sending summary figures.
I do not think it is accurate to say that MTD ITSA failed previously. As far as I can see it didn't really start. Some was written over the past year and there are still bits that have not been put live, but it is pretty well there now.
I do not think it is accurate to say that MTD ITSA failed previously. As far as I can see it didn't really start. Some was written over the past year and there are still bits that have not been put live, but it is pretty well there now.
Eric Mc said:
You are living in fantasy land. In the REAL world, carpenters, brickies, plumbers, shoe shop owners, etc etc will not have the interest or inclination for jumping through complicated and time wasting hoops to satisfy some indeterminate wish of Whitehall bureaucrats.
They have real lives to live and real work to do.
This initiative failed on its first attempted launch. It is doomed to fail again.
I don't think many other accountants would disagree with you. Running a business is hard enough.They have real lives to live and real work to do.
This initiative failed on its first attempted launch. It is doomed to fail again.
johnhemming said:
akirk said:
dreadful coding and worse documentation -
HMRC are subcontracting as far as I know. I have heard of who to, but it was not important enough to me for me to remember. However, I don't agree with the statement "dreadful coding" or "worse documentation". How specifically would you substantiate that argument?
but anyone who has been coding long enough and is used to working with APIs will instantly recognise how poor it is...Spec. for system
API to transfer 9 figures (or fewer if happy to derive some!)
Really must be one of the simplest requirements ever seen - with an overly complex system which has had huge flaws in how it has been coded and in how it has been documented...
To write code for us to transfer 9 figures has taken a hugely disproportionate amount of time to the extent that I am not prepared to have the equivalent and no doubt much higher internal cost to write code for the new approach...
akirk said:
I won’t specifically substantiate it as this thread is a business thread not a geek-fest
We will, therefore, have to agree to disagree on that point as without any detail I cannot work what we might agree about.Assuming you trade through DesignToo Ltd (or some other corporate vehicle) I would assume that MTD ITSA for self employment won't be an issue. Hence although it may come in in the future for all Self Assessment for this particular implementation it won't affect you on a mandatory basis.
johnhemming said:
We will, therefore, have to agree to disagree on that point as without any detail I cannot work what we might agree about.
Assuming you trade through DesignToo Ltd (or some other corporate vehicle) I would assume that MTD ITSA for self employment won't be an issue. Hence although it may come in in the future for all Self Assessment for this particular implementation it won't affect you on a mandatory basis.
We code for ourselves and for our wide range of clients...Assuming you trade through DesignToo Ltd (or some other corporate vehicle) I would assume that MTD ITSA for self employment won't be an issue. Hence although it may come in in the future for all Self Assessment for this particular implementation it won't affect you on a mandatory basis.
johnhemming said:
The idea of Digital Tax is to have an electronic audit trail. There are two main flavours of this SAF-T which involves sending all transactions to the tax authorities and MTD which involves sending summary figures.
I do not think it is accurate to say that MTD ITSA failed previously. As far as I can see it didn't really start. Some was written over the past year and there are still bits that have not been put live, but it is pretty well there now.
If it's anything like VAT MTD, there will be no audit trail - so HMRC will receive nothing of use to them,.I do not think it is accurate to say that MTD ITSA failed previously. As far as I can see it didn't really start. Some was written over the past year and there are still bits that have not been put live, but it is pretty well there now.
It's a time wasting and expensive nonsense.
Eric Mc said:
If it's anything like VAT MTD, there will be no audit trail - so HMRC will receive nothing of use to them,.
It's a time wasting and expensive nonsense.
Exactly. A pointless exercise that will cost the self-employed in both time and money whilst providing nothing of use whatsoever to HMRC.It's a time wasting and expensive nonsense.
Case in point: A client of mine, a very bright thirty something intelligent chap who makes a very good living, but isn't really that computer/accounts savvy, used to keep basic records on a spreadsheet. It worked, it was fine. He moved onto Xero so that he could submit via MTD, and even though he thought he was fine with it, he has in fact made a complete horlicks of it. Now we're going to have to unpick the mess, which will cost time and money.
Eric Mc said:
6 April 2022 (postponed from 6 April 2018).
The House of Commons written statement is here:https://www.parliament.uk/business/publications/wr...
Minister said:
The Government will introduce legislation in Finance Bill 2020/21 to extend Making Tax Digital for VAT to all businesses below the VAT threshold from April 2022, to ensure every VAT-registered business takes the step to move to a modern, digital tax service.
Hence VAT is extended from April 2022.Minister said:
The Government remains committed to extending Making Tax Digital to other taxes. The Making Tax Digital programme will therefore be extended through new regulations to businesses and landlords within Income Tax Self-Assessment from April 2023.
I read this as the 2023-24 tax year. The system is, however, live today.LeighW said:
Eric Mc said:
If it's anything like VAT MTD, there will be no audit trail - so HMRC will receive nothing of use to them,.
It's a time wasting and expensive nonsense.
Exactly. A pointless exercise that will cost the self-employed in both time and money whilst providing nothing of use whatsoever to HMRC.It's a time wasting and expensive nonsense.
Case in point: A client of mine, a very bright thirty something intelligent chap who makes a very good living, but isn't really that computer/accounts savvy, used to keep basic records on a spreadsheet. It worked, it was fine. He moved onto Xero so that he could submit via MTD, and even though he thought he was fine with it, he has in fact made a complete horlicks of it. Now we're going to have to unpick the mess, which will cost time and money.
As it is now, instead of copying numbers out of a spreadsheet into the HMRC website for a VAT return, I now have to have a separate piece of software copy some numbers out of a spreadsheet to sumbit to HMRC. They get no more info than they did previously, and I've had to waste time researching and implmenting a different process. I fully expect that they'll keep demanding more though, and I'll be railroaded into additional costs of subscription book-keeping service before too long...
johnhemming said:
I read this as the 2023-24 tax year. The system is, however, live today.
The news I read was stating tax year 2022/23 as the first year of operation.It doesn't really matter when it is implemented - it's a load of junk anyway.
Initially they said they would not allow spreadsheets to be used as a source recording system for MTD. Then they relented (following massive pressure from industry and commerce) and said you could use a spreadsheet as long as you submitted through bridging software.
That one move renders the whole initiative a complete waste of time as that blows the concept of an audit trail being submitted on a regular basis to HMRC out of the water.
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