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Is bridging software the answer for MTD....

......or is it more a short term sticking plaster?

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Having spoken with a couple of people at Sage recently as well as an inspector from HMRC last Autumn I'm a little confused as to how long bridging software will be a solution for MTD for.  The people at Sage suggested that although bridging software will be fine during the first year of MTD (the 'soft landing' period) they won't be thereafter.  Certainly if you're exporting from older versions of Sage the core data required won't be there apparently.  There's also the issue for Sage clients that Sage are effectively disabling the older versions should you get to the point of reinstalling on new PC's/servers etc.

We have a number of clients who are looking to use the bridging software but I'm wondering whether they would be better to just bite the bullet and switch to Xero/QB etc now.  Are these spreadsheet solutions going to be around for a few years or, as Sage and the Inspector suggested, they will be pretty much defunct within a relatively short period?

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Replying to North East Accountant:
RLI
By lionofludesch
01st Mar 2019 15:48

If HMRC said it was raining, I'd still look out of the window to see for myself.

They have no credibility at all.

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By robbie2016
04th Mar 2019 10:55

Sage would say that wouldn't they.

Bridging software will be here to stay for many years. If anything, HMRC will relax the requirements further once they realise the chaos caused.

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Replying to robbie2016:
RLI
By lionofludesch
04th Mar 2019 12:09

robbie2016 wrote:

Sage would say that wouldn't they.

Bridging software will be here to stay for many years. If anything, HMRC will relax the requirements further once they realise the chaos caused.

You're assuming they care.

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Morph
By kevinringer
04th Mar 2019 15:06

To answer the OP's question - please clarify the question.

Q1. Is bridging software the answer for MTD for VAT?
A1. Yes - if you or your clients use spreadsheets currently then bridging software is your forever solution.

Q2. Is bridging software the answer for MTD for income tax?
A2. Maybe this is an academic question because MTD for income tax appears to have been killed off. But if MTD for VAT is not too painful for HMRC I suspect they will resurrect MTD for income tax. I personally don't think bridging software would work for MTD for income tax. It is easy to link up 7 boxes to column totals but it is far more complex to link up income and expense listings to a tax return self employment schedule-type level of detail.

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Replying to kevinringer:
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By david.bransbury
04th Mar 2019 15:49

Just to warn you I don't think the MTD for IT has been killed off.

There is now a separate compatible software page for MTD for IT.

https://www.gov.uk/guidance/find-software-thats-compatible-with-making-t...

Last time I paid attention to this list it was 2 and now it is 4, plus there are 2 further products in development. None of them seem to be bridging software and if it was 60 names on the list rather than 6 than I would be lot more worried we were going to some announcement shortly. However why would a commercial business waste money in developing MTD for IT software if it is not compulsory currently and there is no certain start date.

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Replying to david.bransbury:
By Duggimon
04th Mar 2019 16:01

Absolute, first on the list, is bridging software.

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Replying to Duggimon:
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By david.bransbury
04th Mar 2019 16:24

Yes Absolute do have a MTD for VAT bridging software product. However their MTD for IT product is not bridging software.

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Replying to david.bransbury:
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By johnhemming
04th Mar 2019 18:28

ITSA is still being developed. The submission of the data can be done through bridging software as it remains the submission of totals. In fact, however, it would be possible to use bridging software to submit transactions anyway.

ITSA is quite a bit more complex, however, as IT is more complex than VAT.

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Replying to Duggimon:
RLI
By lionofludesch
04th Mar 2019 16:24

Depends.

I wouldn't recommend bridging software for someone who kept paper records.

May as well jump straight to proper accounting software.

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Replying to lionofludesch:
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By DaveyJonesLocker
05th Mar 2019 11:45

Proper? Cloud software is notoriously bad at mis-categorising bank feeds etc.

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Replying to DaveyJonesLocker:
By Charlie Carne
07th Mar 2019 22:21

DaveyJonesLocker wrote:

Proper? Cloud software is notoriously bad at mis-categorising bank feeds etc.


Software is good, but it's not magic. It makes a reasonable stab at guessing the categories and you can improve on that by creating rules in (eg) QBO or Xero. But, as accountants, it is still our responsibility to check that the coding is correct. Desktop software doesn't do it any better (and usually worse, as most have no bank feed). What do you expect cloud software to do with bank feeds and what desktop software does it better?
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Replying to charliecarne:
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By DaveyJonesLocker
08th Mar 2019 08:34

By the time I've spent checking bank feeds on cloud software, I'd have been quicker just entering the transaction as I'm a quick inputter. I've used both.

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By ILAB
07th Mar 2019 10:50

According to our reseller the on premises version of Sage 200 is still waiting for Sage to finish the MTD VAT return submission software. This is a bit of a problem for the reseller as their pitch for us to upgrade to the latest version of Sage 200 was to make it MTD compliant, but with less than a month to go to 1st April the system is still not MTD compliant! Sage is not covering itself with glory as far as MTD is concerned - lets hope it's not like the Pension Auto-enrolement add on to Sage Payroll which was so expensive we switched the payroll to Brightpay.

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By fellowcraft
07th Mar 2019 10:50

We are going to run all VR's through the bridging software, whatever system the client is on, to keep everything in one place and consistent

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