Anonymous
Share this content
0
1117

How many MTD returns will be wrong ?

The concerted efforts of HMRC have caused everyone to file by MTD rather than break the Law.

Didn't find your answer?

Search AccountingWEB

So its seems that HMRC have educated Taxpayers and Accountants to complete the sign up process which means they have success with that.

I am just wondering how many of those signed up are just putting the 9 boxes in the software with totals or how many are completing their VAT returns from incorrect figures produced without checking from software . Its also interesting to know how many might be signed up who for one reason or another should be exempt and how many were unable to file even though they signed up.

Interesting times dont you think as HMRC will have no idea about this untill the start a targeted compliance check !!

Anonymous 

Replies

Please login or register to join the discussion.

avatar
15th Aug 2019 00:41

Please note that posting as an anonymous user is reserved for sensitive content that you need help with but don't want people to know who you are.

However, it will also mean that other users will not be able to get in touch with you or see your history on the site and therefor might not be as willing to provide you with a reply.

Any abuse of the ability to publish anonymously will not be tolerated and offending users will be banned from AccountingWEB.

Thanks (1)
15th Aug 2019 08:40

Clearly a very sensitive issue for the OP.

Thanks (1)
15th Aug 2019 10:36

I would guess that quite a few people will have run into problems. I don't mind admitting that I, a qualified accountant of a very long time who thought that they knew their own software inside out discovered that my new MTD returns were throwing up all kinds of oddities - first off it claimed that figures were 'adjusted' when they were not - this is apparently a rounding issue which the software is investigating! So I have no idea about that, but it will be a real worry once the software starts 'talking to HMRC' if it is making errors internally... Then I had a whole section called 'Late Claims' - it transpired that I was not doing something called 'publishing' my old style returns when I created a return and PDF'd it before entering it into HMRC's system (I was not using the software to submit to HMRC pre-MTD as I tried a couple of times and got errors and then got a surcharge warning for not realising it has not filed - once bitten twice shy and all that). I notice from the forums for the software that hundreds of people seem to have had this issue with so called late claims. I ended up having to go back and run a couple of year's returns again and try and work out what on earth was happening. After three days I gave up, I doubt that there is any major loss to HMRC but there was a huge loss to us in terms of my time. I have kept a record of my pathetic efforts to sign up for MTD, see https://www.rossmartin.co.uk/making-tax-digital-vat I still cannot get one of our own companies properly signed up and that is very, very irritating. So yes, if people are not thoroughly investigating what is happening to their so-called 'Late claims' its very likely that their first returns will be wrong.

Thanks (1)
15th Aug 2019 11:06

We haven't changed any underlying processes prior to production of the end boxes at all on our test sample (I did a handful first up, but have a bigger batch this quarter, about half of those who are due to use it for the quarter, no penalties can arise of course for non-compliance so not worth getting in a lather over this)

Same figures being sent to HMRC in a slightly different process. I am using VT so you can just copy and paste the numbers in, and send 'em on their way.

HMRC have no way of knowing what happens our side, and no resources to check.

They can trumpet the huge success of the project (no doubt forgetting about all the revenue it was going to raise)
The clients can do what they always did.
Complete waste of time all round of course.

Thanks (1)
By Tornado
to ireallyshouldknowthisbut
15th Aug 2019 14:14

The bespoke Excel accounting software that we have used for clients for some 15 years now always automatically showed the entries to be made in the 9 boxes on the VAT Return through the old portal. The results in the 9 boxes were set to display to 2 decimal points but in fact the figures were being calculated to many more decimal points as there were multiple calculations being carried out before arriving at the final figures. This did not particularly matter for the manual entry.

In order to extract a valid .csv file for the bridging software to 2 decimal places, we had to amend the formula in each of the 9 boxes using the Roundup or Rounddown macros so that the answer itself was to 2 decimal places and it all works fine now.

In order to extract the .csv file easier, a new worksheet was created for each quarter and the results of the 9 boxes linked to just 9 boxes on the new work sheet. The .csv file extracted from that worksheet alone can then be very quickly mapped to the VAT Return draft in the Bridging Software as there are only 9 figures in the .csv file.

We also have similar Accounting Software in another spreadsheet program from which the .csv file can be extracted directly from the main source, making the process even easier.

Overall we have had to change very little in the way of software in adapting to MTD for VAT and the only software costs have been an annual cost for each client of about £5 per annum for the bridging software as most people have Excel anyway.

Yes indeed, exactly the same information being submitted under MTD for VAT as prior to MTD for VAT, and it is really difficult to work out what this has all been for.

The situation would have been completely different for us if HMRC insisted on the submission of more information, and all of the other fantasy ideas of MTD, but I am now sure that I will be retired in the sun if that ever happens now.

Thanks (0)
avatar
to Tornado
16th Aug 2019 10:01

just found out from Xero that if you amend an invoice in any way (that might be a description change for example) yet no change to the figures, it then falls into the late entries section. So if you had included it in a previous vat Q it then reappears in the next Q . I suspect many agents filing in MTD will not be looking for this but potentially means that clients are paying far more in box 1 than they should.

In the pre-MTD version you could select whether to include late entries. There needs to be a way to deselect items in late filing where they have already been filed. Be keen to hear whether others are aware of this. Could be catastrophic if not picked up.

Thanks (1)
to C Graham
16th Aug 2019 11:10

I believe that Xero does this in a similar way to QBO. In QBO, if you amend a transaction from a prior period (that has already been flagged in the software as filed for VAT), then it will create in the late claims/exceptional items section BOTH a negative entry for the original transaction and a positive entry for the amended version of that transaction.

If your change was (for example) only to the description and not to the figures, then the negative and positive figures will contra each other to zero. If the amounts have changed, then the negative value will contra the originally filed (incorrect) transaction from a prior VAT quarter and the positive amount will reflect the correct value to be claimed. So there is no need to worry, as it correctly deals with this.

Thanks (0)
avatar
to charliecarne
16th Aug 2019 13:33

You are right Charlie and in fact when I queried with Xero why non-vat edits would still create a late entry, they advised to make a manual adjustment. i have posted on another thread but in fact yes it does correct itself so the Xero advice was wrong. I can understand if there was a change to the figures or codes but not to eg adding a PO or reference to a filed invoice.

Thanks (0)
avatar
to C Graham
16th Aug 2019 11:14

I hate to say ' I told you so', but those of us who chose to stick to our spreadsheet guns despite the ridicule and marketing pressure we have had to endure from the software lobby, predicted many of the pigeons that are now coming home to roost for business using MTD packaged software.

Thanks (0)
avatar
By JacF
16th Aug 2019 09:57

Perhaps the compliance checks are starting. I have a client who has a VAT inspection booked for October and the letter says the purpose is to check VAT returns and also to check software and how returns are submitted (sorry can't remember the exact wording, letter is at client premises) but reading between the lines it sounds as though they are checking for MTD compliance. It also says they will help and advise re the software submissions.

Thanks (0)
16th Aug 2019 13:29

We use excel for most clients and have continued with excel with Absolute VAT Filer, so no difference in the content.

I have a few clients switched to software and I am wondering about the accuracy of the records. For example a garage switched to QuickBooks online and now gets refunds!

HMRC were warned about software errors and the lack of intelligence within the software eg Sage defaults most transactions to T1 thus claiming the VAT on everything. QuickBooks is similar. Some users might think that is correct and go along with it. Others might not understand what T1 is. Others might think it's wrong but because it is software and HMRC have told them to switch to software it must be right because surely HMRC wouldn't have told businesses to switch to something that is wrong.

I would like to know how the total VAT receipts for 0619 compared with forecast.

Thanks (0)
Share this content