MTD late submission

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I have a Xero client who has (in addition to leaving it until last minute) made a complete hash up of it. Think sales as debits and, those treated correctly as credits, have been recorded twice with one entry still sitting on Aged Receivables - and lots of other stuff - thats a good indication of where I find myself this morning. A pity they insisted they could - this is one where I did actually advise them they should instruct a bookkeeper.

Anyway, it won't be filed on time. At a push it maybe on Friday.

So, what do I do about the payment of approx £15k which I can estimate from past years - I can recommend they make a online transfer today with return to follow but will the direct debit still be taken (just a different date) when the return is eventually filed? 

 

 

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By johnhemming
07th Aug 2019 11:46

The problem is that you don't know what will happen when you submit the vat return. What you might be best doing is submitting an approximate vat return (potentially using bridging) and making an adjustment on the next vat return.

It is only when you submit the vat return that you will find out whether or not they are likely to take the DD.

I can help further if you email me ([email protected]).

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Replying to johnhemming:
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By Kaylee100
07th Aug 2019 15:37

Thanks!

They are going with filing late(planning on Friday) and paying late and getting rapped knuckles as they don't really have the funds to have 2 x £20k taken and realise the error of their ways, especially the dealing with everything last minute and making things up rather than asking for advice then doing it. I've had a 90 minute meeting with them, put the "difficult" things right with them and left them to do their homework for the rest.

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Replying to Kaylee100:
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By johnhemming
07th Aug 2019 16:04

It is one of the problems that many (possibly most) clients don't have the funds to pay twice. There is a problem with timing in that DDs are normally taken slightly later.

However, I think this falls into the category of things where HMRC should be relaxed particularly about a small delay of only a few days.

I had one of these yesterday where the electronic receipt indicated that contrary to other expectations (ie they had a DD email saying the reference had changed) a DD would not be taken.

They have no real choice but to wait until they see what happens and if the DD is not taken to then send the funds.

I have also seen more recently some examples of really out of date submissions. It appears that some cloud providers cannot handle submissions that are more than a year out of date. I don't know how far back MTD actually goes, but I know it can handle a submission for Q1 2018. Whether it goes back any further I don't know.

I have to run special functions for very old submissions as the HMRC MTD Apis only cope with a limited date range for some of the API calls.

I would not myself expect any penalties to be issued, but if there are then I would be happy to coordinate a lobbying exercise about the unjustness of that. As some people know I have considerable experience of how the political system operates and would be happy to put that to use.

I have, however, seen payments that were quite late being ignored by HMRC if people are trying to comply with MTD.

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