Chancellor Takes Excess Comfort From One Company's MTD Progress

At a small business reception at 11 Downing Street, Philip Hammond asked Gary Turner, managing director at software company Xero, about Making Tax Digital and Xero’s preparations to which Turner confirmed that Xero are ‘all sorted’ and are working with HMRC on the project.

From 1 April 2019, VAT registered businesses earning above the current VAT threshold of £85,000 are mandated to keep digital records and submit VAT returns using MTD-compatible software.

Xero is one of many software providers who are providing compatible software for businesses to use come April 2019.


Now whilst this is all well and good, as far as the Chancellor hearing what he wanted to hear, there is rather a large fly in Hammond's ointment, as espoused by Damon Anderson, director, partner and product at Xero, who told Accountancy Daily:

‘Our research has shown that 25% of small businesses currently are not even aware of Making Tax Digital and these that are only 23% realise it’s compulsory, so it is important for us to make sure that everyone is aware that it is coming up very soon.

People have been able to file VAT in Xero for a long time, but we have taken the opportunity to upgrade the experience and have added 30 new features so Making Tax Digital for VAT is taken care of. We are not worried about our ability to prepare for Making Tax Digital we are more concerned about people realising that it is something they have to do.’

Yup, there are a lot of businesses that are not ready for MTD...is HMRC?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC's Unusual Combination of Income Types

Taxpayers who have certain income sources and amounts are finding that HMRC’s servers are unable to calculate the correct amount of tax due. Due to discrepancies in the calculations the servers reject any self assessments submitted with the correct tax calculation generated by third party software.

As such, taxpayers who encounter this issue will have to submit a paper tax return.

These circumstances are identified by HMRC as ‘exclusions’ each year. HMRC has added 16 exclusions for 2016/17 identified in collaboration with software developers.

A HMRC spokesperson told CCH Daily:

‘HMRC is working hard to ensure that no tax is incorrectly assessed. A very small number of self assessment taxpayers who have a very unusual combination of income types will have to use paper tax returns.’ 

Hey-ho, good luck with that then!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC Software Not Up To The Job

As this recent article in the FT shows, HMRC software simply isn't up to the job:

"Software glitches are putting thousands of people at risk of paying hundreds of pounds too much tax next year, as programmers struggle to cope with an increasingly complex tax system. 

Experts blamed the “horrendously complex” changes to the taxation of dividends and savings income for errors in the tax computation software for the 2016-17 tax year which ended on Wednesday. They said the problems were caused by the interaction of the new tax-free allowances for dividends and savings and the zero per cent savings rate band. 

HM Revenue & Customs will provide a fix for 2017-18 tax returns but in the meantime those affected are asked to file paper returns. 

Giles Mooney of Absolute Accounting Software, a software provider, said the “insanely complicated set of rules” were to blame for the inability of the HMRC coders to solve the problem before the end of the tax year. 

 Caroline Miskin of the ICAEW, the professional institute, said the problems affected a “quite small” number of people but followed similar problems affecting HMRC’s online filing systems. “They seem to struggle to implement software changes necessary to reflect changes in law.” 

What hope is there for Making Tax Digital on time, on budget and fully functioning?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Meet Lee Hawksworth - The New Head of Software Developer Collaboration

Lee Hawksworth has been appointed as HMRC's Head of Software Developer Collaboration.

He's not entirely sure what the role means, but is willing to give it a go!

As per his blog:

"It sounds great, but what does it really mean?  

Well, I might be better placed to answer that in a few weeks!"

Let's see how this pans out then!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC Software

HMRC software didn't understand "I don't know the NI number" but it did understand "I don't know the sodding NI number"

— Stuart Jones (@StuartJones) May 19, 2015

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"