xero for digital tax
Discussion
Anyone use this or been asked to?
I have by my accountants who assure me it's perfectly safe and can't allow third party access to accounts. However it does feel a bit like giving up the crown jewels..
Also the online bank landing page is different to my usual login page which does have me slightly concerned.
I have by my accountants who assure me it's perfectly safe and can't allow third party access to accounts. However it does feel a bit like giving up the crown jewels..
Also the online bank landing page is different to my usual login page which does have me slightly concerned.
All valid concerns. We've got many 'old school' clients who jump at any mention of a digital bank link because they think HMRC will be able to see into their accounts etc.
The software (Xero, Quickbooks, Sage, Freeagent etc.) can link to your bank account and that's it. Any VAT returns (and in time, tax return) need to be filed with HMRC through the software but this most certainly doesn't mean that HMRC have access to your software and bank account. The 'Making Tax Digital' idea is simply to eliminate erroneous information and deliberate mistakes. By having a bank account linked to the software, and reconciling the accounts through the software, it makes everything tidier and a lot more accurate than figures bashed into an 'offline' spreadsheet then transposed into a blank tax return or set of accounts where errors are more likely.
There is indeed a slightly different login page when granting permissions to the software to link your bank accounts, and HMRC have a list of recognised software, therefore it's always a good idea to use one of those (Xero is approved, obviously).
The software (Xero, Quickbooks, Sage, Freeagent etc.) can link to your bank account and that's it. Any VAT returns (and in time, tax return) need to be filed with HMRC through the software but this most certainly doesn't mean that HMRC have access to your software and bank account. The 'Making Tax Digital' idea is simply to eliminate erroneous information and deliberate mistakes. By having a bank account linked to the software, and reconciling the accounts through the software, it makes everything tidier and a lot more accurate than figures bashed into an 'offline' spreadsheet then transposed into a blank tax return or set of accounts where errors are more likely.
There is indeed a slightly different login page when granting permissions to the software to link your bank accounts, and HMRC have a list of recognised software, therefore it's always a good idea to use one of those (Xero is approved, obviously).
I’ve used Xero since ‘MTD’ came in. No issues with it, I sat with my accountant for an hour and we set up all the payment types relevant to my line of work. Once you get rolling with it it’s pretty easy to use and makes VAT returns etc a doddle.
You can give your accountant certain permissions so that they can access when they need to do year end returns etc.
You have to link to your bank account so that transactions translate across to the xero ‘dashboard’ and you just need to ‘reconcile’ these as and when you feel the need.
The only downside I saw was that it didn’t really reduce my accountants fees which I was kind of expecting it to as surely it makes their job easier?
I’ll be exiting Xero soon as am in the process of shutting down my Ltd co due being inside IR35 since Jan, but if I find myself outside again with the need to use 3rd party accounting software then I’d use Xero again probably as have had no issues.
You can give your accountant certain permissions so that they can access when they need to do year end returns etc.
You have to link to your bank account so that transactions translate across to the xero ‘dashboard’ and you just need to ‘reconcile’ these as and when you feel the need.
The only downside I saw was that it didn’t really reduce my accountants fees which I was kind of expecting it to as surely it makes their job easier?
I’ll be exiting Xero soon as am in the process of shutting down my Ltd co due being inside IR35 since Jan, but if I find myself outside again with the need to use 3rd party accounting software then I’d use Xero again probably as have had no issues.
[quote=MDJ
The only downside I saw was that it didn’t really reduce my accountants fees which I was kind of expecting it to as surely it makes their job easier?
[/quote]
Hardly ever does.
The accountants job with limited co. accounts is to ensure they are in agreement with accounting standards, Company Law and HMRC Corporation Tax rules.
The time saving in providing a balanced and "almost" correct set of figures to the accountant is marginal compared to the actual work they still have to do.
The only downside I saw was that it didn’t really reduce my accountants fees which I was kind of expecting it to as surely it makes their job easier?
[/quote]
Hardly ever does.
The accountants job with limited co. accounts is to ensure they are in agreement with accounting standards, Company Law and HMRC Corporation Tax rules.
The time saving in providing a balanced and "almost" correct set of figures to the accountant is marginal compared to the actual work they still have to do.
Eric Mc said:
Hardly ever does.
The accountants job with limited co. accounts is to ensure they are in agreement with accounting standards, Company Law and HMRC Corporation Tax rules.
The time saving in providing a balanced and "almost" correct set of figures to the accountant is marginal compared to the actual work they still have to do.
Sounds reasonable enough. Probably my naivety/ignorance. Accountancy has always been witchcraft to me :-)The accountants job with limited co. accounts is to ensure they are in agreement with accounting standards, Company Law and HMRC Corporation Tax rules.
The time saving in providing a balanced and "almost" correct set of figures to the accountant is marginal compared to the actual work they still have to do.
lizardbrain said:
The statement import stuff is read only I think.
Nobody needs access to your actual bank account
It’s more or less risk free to give accountants access as far as I can tell?
Love xero it’s great.
Yes that’s correct. No one other than you has access to your bank account. The accountants just see the transactions in/out of that account. Nothing to worry about on that front.Nobody needs access to your actual bank account
It’s more or less risk free to give accountants access as far as I can tell?
Love xero it’s great.
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