I'm struggling to visualise the brave new world of MTD. After speaking with someone from a software provider last week I just can't see how it will work for us as a practice. The software provider was saying that the client will take photos of receipts on their smart phone - (because everyone has one) and upload them to HMRC. The software reads the receipts and produces accounts and the accountant can check this at the end of the year. We already knew this anyway but it then got me thinking how good is the software that will read the receipts.Will the software know that along with fuel the client has bought a packet of cigarettes, some chewing gum and a bottle of wine and correctly apportion the costs or can it find printer paper in a clients weekly shop. When I put some common scenerio's to the rep from the software company the answers weren't very satisfactory. For clients using personal cash or bank accounts to loan money to the company short term the client would need to link both company and personal bank accounts into the software so things could be allocated correctly. When I asked about clients we do bookkeeping for the reps said the client would be able to take photos for receipts so we wouldn't need to bookkeep for them. When I pointed out they wanted us to do the books because they could earn more doing their day job the response was you will need to take photos then. Some clients have over 500 receipts a quarter I can't see us having time to sit there snapping pictures let alone the data allowance.
Are any practices using software to read receipts and allocate them to the correct place in the accounts, does it work or is it a pipe dream?
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HMRC response to the consultations says it will not be compulsory to take pictures of invoices etc. so for clients where you do the bookkeeping, other than the issue of deadlines and MTD compatible software, I don't see anything would have to change from what you are doing at present.
Although if we actually knew what HMRC are going to demand by way of computerised records it would be a lot easier to plan ahead.
I think you need to catch up with what is actually happening, vs some rubbish from a sales person.
The "picture on phone" fantasy of Gauke has largely gone quiet.
I dont think we will be snapping photos of receipts. If necessary, they will be loaded into a scanner.
Dont listen to salesmen from software companies!
Also, you say that the spftware company told you the clients will snap photos of receipts and upload to HMRC. That is not quite correct although i suspect you may have been paraphrasing.
It is happening whether we like it or not, so my attitude is, embrace it and aim to make it work in the best way possible for both my practice and my clients.
I see it creating moe work rather than less. Information is definitely lacking though.
We have some clients already using receipt bank to scan/read their invoices and enter into the book-keeping software.
It's an absolute nightmare. Duplications everywhere!
Eg when someone buys fuel for their car, they get two receipts - one being the till/vat receipt, the other being the credit card payment receipt. Clients just pile them all up and send them to receipt bank, so both get scanned, read and entered, meaning duplication. Same with restaurant bills, already they're worse because the amounts are usually different, the credit card slip being higher due to the tip so aren't as easy to spot.
Other issue is hotel bills. One bill upon check in with the deposit, then another bill for the full amount upon checking out. The deposit is therefore duplicated.
Not to mention loads of personal stuff ending up in the book-keeping.
We've had no end of hassle trying to educate clients to sort out their receipts before sending/scanning, but they're too lazy to do it. These being the clients too lazy to do their own book-keeping in the first place. They seem to think it's perfectly OK to just empty their wallet/purse/pocket every month and send the lot, assuming someone else will magically know which are private and which are duplicated!
[quote=Ken Howard]
We have some clients already using receipt bank to scan/read their invoices and enter into the book-keeping software.
It's an absolute nightmare. Duplications everywhere!
Use autoentry instead. So much better than receipt bank as it recognises duplicated receipts.
We did a trial with autoentry this month and found it more expensive and time consuming than manually analysing receipts.
Autorec is good for bank analysis though but understand this product is being discontinued / migrated to Auto Entry. Shame that bankstream has been swallowed by quickbooks, would be good to see another bankstream independent offering as think would be popular.
Good to hear Receipt Bank doesn't work, won't bother looking into that further then.
Thanks for your replies. I was curious how the software would deal with all the rubbish on the invoices and the additional rubbish that has nothing to do with the accounts. From Ken's reply it suggests it won't. With regard to the photos of receipts to HMRC I wasn't paraphrasing. I was wondering how I could get the square pegs into the soft wares round holes.
I think Sage One has already got MTD in place, but not much advertisement about it.
Each time you process a purchase invoice there is a facility to attach a scanned invoice.
No doubt at some point Sage will let all users know it is ready for MTD.
The only time waster I see is actually remembering to scan each invoice as it is processed.
I imagine that (some) software representatives are similar in capability to car salesmen. Pretty useless unless they have their line manager holding their hand and, if they are let loose, they say the first thing which comes into their head, which they think is "popular", or even worse, "trending"!
If any of them had brains to think for themselves, they'd be absolutely lethal.
I wouldn't listen too much to the software salesperson as MTD will not work practically in the 'Pete the Plumber' form for most small businesses. I know someone who went on a MTD seminar and turned down the offer of one a couple of months later as they had covered that topic - basically the topic is changing weekly and is still stupid for small businesses in my opinion but is gradually evolving to at least be better than what we started off with.
Just heard that Labour want to exempt any businesses from MTD who have turnover beneath the VAT threshold so maybe we should vote for them and save ourselves a lot of hassle?!!
The feeling I get is that HMRC are shifting gently from "digital and daily" (i.e. real time capture of all accounting information) to "online and quarterly" (i.e. upload summarised information direct to HMRC's computer, no doubt leading eventually to quarterly on account direct debits). No doubt the software for real time data capture will improve with time, but it will be interesting to see whether it ever gets to be good enough. There may be parallels with dictation software. I'm hearing different feedback from practitioners attending presentations by HMRC and others. Anyone else have a feel for this?
I was considering Receiptbank myself and now have had my fears confirmed by the above posts. It's a conundrum for sure - invest heavily now in a software platform and market it to the masses, start focussing on winning new tech-savvy clients, or sit back and wait and see what happens as it seems like there will be plenty of work out there for us all. Who said accountancy was boring?!
I was sent five photos of receipts recently.
Couldn't read four of them. Not enough pixels.
Is that a problem ? Taxpayer takes a picture, doesn't check to see if it can be read, thinks "I don't need this paper now", tax take for HMRC increases because the expense can't be claimed, HMRC very happy.
As with anything there are faults.
Poor quality images - yes clients do need a bit of training in this area, they soon pick it up though.
Receipt Bank duplicates - yes a pretty big issue. AutoEntry on the other hand does recognise duplicates.
AutoEntry/ReceiptBank more time consuming that manual entry? Hmmm don't see this myself when you add in the time/cost of you collecting or client sending receipts/invoices. Add on that there is no requirement to keep hard copies of those documents. Work can also be done as and when time allows rather than waiting for the files at month/quarter end and causing a workflow log jam.
HAs a client that has been using a Free Itap app to photo his receipts, has been doing that for the last 2 years, came to us and said all his receipts were on the phone - I contacted receipt bank as apparently we have to sign up to see the data and for one client it was going to cost us £75 +vat per month - then goes down to £85 per month for 10 clients - where is the incentive to "dip our toe" and try out receipt bank - we only have one client using the app - when I mentioned to the client the costs of extracting the data, he found a way to download the data into CSV - not such a free app after all unless the software companies assume the accountants are not going to pass on the costs - glad to see the comments here about the practicalities of using it.
I have been using receipt bank for a while now. It's not perfect but I tend to use it not the client so it's easier. I have invested in a decent scanner (Scansnap ix500) comes with great software and will do duplex scanning on a single pass. Will handle great piles of invoices that I sort before scanning.
Once the software is also trained a little it really is a time saver. Not a panacea but in the right circumstances it does save time. So now I can enter say 30 Travis Perkins invoices to a builders QB in the time it takes to scan them (which is under a minute with the scansnap).
It's the usual garbage in garbage out but with some initial time and effort it starts to make sense. Add this to QB online that does bank down loads that will match to RB transactions and the number of manually entered transactions can be minimal. I have a couple of regular VATS that are now very much quicker than dealing with the pile of receipts manually or even paying someone to put them in. If I equate Receipt Bank fees to staff time it's a winner in my book.
Mayb I'm just a geek but actually if it took me the same amount of time as doing it manually i'd still do it as it's less dull - but maybe that's just me!
[quote=coolmanwithbeard]
I have been using receipt bank for a while now. It's not perfect but I tend to use it not the client so it's easier. I have invested in a decent scanner (Scansnap ix500) comes with great software and will do duplex scanning on a single pass. Will handle great piles of invoices that I sort before scanning.
I understand the scanner comes with it's own receipt software. Have you tried that and does it work? I'm going to be buying this scanner in early May so curious.
I have dabbled with the receipt software but not that good compared to RB and it still needs entering onto an accounting system which this software wont do. As RB will use a photo or a PDF I see no point and the files are attached in QB.
You will love the scanner I find it best to scan similar sized receipts together if I'm doing a batch to up load. Pay and display car parking tickets just rattle through in no time - see geek again!
M
Kent managed to convince me and I'm now also using the Fuji Scansnap ix500.
I use it with AutoEntry though as much cheaper if absorbing the cost into your monthly fees. Multiple companies and a dash board at no extra cost unlike receipt bank.
It definitely costs more than manual input but frees up that low rate monotonous work and makes me feel properly 21st century.
KentAccountant has a good blog this week about profit vs efficiency.