Jan 2020: Lessons for a volatile year
Moving into January, the self assessment tax season is in full swing, with a few minor distractions such as the long-awaited Budget date announcement for 11 March and a spate of interruptions to HMRC’s MTD for VAT application programming interfaces (APIs).
As predicted, election-based content peaked energetically around 12 December but then receded rapidly. The small, but engaged band of fintech enthusiasts responded to articles on the subject from our new contributor Nick Levine, but this traffic also dropped away after the early December Fintech Connect event.
With self assessment tax issues dominating traffic in the lead-up to the holiday period, it’s a good opportunity to look back at a very volatile year – both for the country at large and the accounting profession.
Traffic around the European Union surged during October as “will we-won’t we?” suspense built, but until there are concrete policy decisions in place, accountants had enough other compliance headaches to wrestle with during the year, most notably the introduction of mandatory MTD for VAT filing for 1.4m organisations above the £85,000 threshold.
MTD monopolised our attention in the first half of the year, peaking in July when the first wave of MTD for VAT returns were due for submission. Once that shock was out of the way, accountants started fretting about the planned reverse VAT charge for construction companies. Due to other commitments dominating the agenda and in response to industry lobbying, the new government under Boris Johnson opted to delay the charge for 12 months in September.
We’re all used to discussing the accelerating rate of technology change within accountancy, but over the past decade, AccountingWEB has seen the volume of “compliance shocks” rise too. In the old days, most Budgets could be relied on to produce an ugly surprise, with occasional breaks for good behaviour.
But thinking back to GDPR, MTD for Income Tax, the VAT reverse charge, off-payroll rules for IR35 and new, tougher anti-money laundering regulations, the profession is being asked to cope with two or three major compliance changes at a time.
Ironically, the more automated we get, the more stressed accountants get about compliance changes because so many of them prompt technology reviews and time-consuming and costly system upgrades.
The level of anguish experienced can be easily assessed by dipping into the conversations on AccountingWEB. Some accountants may use Any Answers to let off steam, but the most successful practitioners (and suppliers) we meet are fully conversant with the key compliance issues, but exude an air of controlled calm.
This quality will be just as important in 2020. MTD may be taking a breather, but the 31 January self assessment deadline this year coincides with the likely date of the UK’s departure from the European Union. Anyone hoping to slip away to the ski slopes in February will first need to ensure that they’ve made arrangements to submit their final claims for EU VAT rebates and registered for the VAT mini one-stop (MOSS) non-union scheme in an EU Member State to maintain continuity in VAT reporting on sales to and from the EU.
Six days later, December’s quarterly VAT returns will be due for submission.
There will be a respite until the 11 March Budget. What we do already know is that the private sector off-payroll rule reforms are set to proceed from 1 April so private sector engagers, contractors and accountants will only just over three weeks to line up their employment status ducks.
Brexit has tied up Whitehall in negotiations and scenario planning for much of the past three years. That effort may intensify from the end of this month, but with 18 months since the last Budget, who knows what other surprises the Chancellor might find in the Treasury’s tax policy cupboard?
Our first series of blogs on the mood and preoccupations of the AccountingWEB community may have emphasised the dramas they have been going through during a particularly volatile year.
Now, more than ever, businesses and accountants are going to need clear-sighted help with the latest compliance shocks and effective solutions delivered with a minimum of fuss. In partnership with our Insight Exchange advertisers, we will work to live up to that goal in 2020.
Top stories in 2019
A lot of the big hits for the year echoed the underlying themes highlighted earlier – notably Making Tax Digital, the reverse VAT charge for builders, anti-money laundering regulations and IR35, as in the BBC presenters' tribunal case.
Business and accounting failures tussled with Power BI for the top story among business accountants, reflect an interest in big, strategic issues as well as the nitty-gritty of management reporting. It's also worth noting that reference content around FRS 102 from previous years continued to draw large audiences throughout 2019. As BrightPay and Xero demonstrated in their popular Industry Insights blogs, accountants will always welcome clear guidance on persistent compliance challenges.
- Taxpayer learns the hard way for unreasonable behaviour
- New rules for personal leasing contracts
- Three BBC presenters lose IR35 case
- Reverse charge for builders delayed until 2020
- HMRC cancels penalties for parents
- ACCA student lied to boss about qualifications
- HMRC slaps AML non-compliant firm with fine
- KPMG shutters small business accounting unit
- Mounting errors force accountant to accept £13,000 fine
- Striking off a company: Get the details right
- Thomas Cook management under fire for litany of accounting failures
- Tesco plans clawback of mistaken redundancy pay from fired staff
- Directors’ current account: Company law requirements
- Accounting probe at Eddie Stobart signals end of the road for CEO
- World’s largest weed business makes blazing spreadsheet error
- Bokio brings free accounts software to UK
- Xero slips off Power BI menu (temporarily)
- Useful features of XLOOKUP
- Meet the 2019 software excellence award winners
- Death of data tables and PivotTables?
- Xero: Deadline for filing monthly VAT returns under Making Tax Digital is 7 June – are you ready?
- Xero launches Equivalency Certification to train the next generation of accountants and bookkeepers
- BrightPay: 3 GDPR myths you need to ignore
- BrightPay: The IR35 clampdowns keep on coming - Three BBC presenters are made pay back a total of £92,000
- ProActivTax: CGT - Payment by instalments