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“Where’s HMRC?”: MTD for ITSA at AccountingWEB Live in quotes

6th Dec 2022
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Bright was created in 2021 when Thesaurus Software Ltd. and Relate Software Ltd. decided to join...
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We're putting our sensible hats on for this one! Read on for a quick round-up of how MTD for ITSA fared at AccountingWEB Live in three quotes from the show.

It’s the question that dominated this year’s AccountingWEB Live Expo. Around the venue, from those stopping by the Bright stand to accountants speaking on panels – just two little words featured over and over. “Where’s HMRC?”

It’s certainly a notable absence on the HMRC front – though, for clarity, there was an HMRC presence in the form of Chris Jennings (VAT talk) and Paul Aplin (billed as “Tax Expert and HMRC Admin Burdens Advisory Board member”). This show is the last before the ‘one year to go’ countdown to MTD for ITSA begins in April 2023 – a fact that’s apparent in the dominance of the subject across all the talk spaces here.

Unfortunately, no one seems to know exactly what’s behind the missing piece of the ITSA preparation puzzle (for the second time, HMRC also pulled out of speaking at the ICPA MTD ITSA conference a few months ago). Speculation abounds, but nothing is confirmed – but it may be that delays or changes are imminent.

But with a little over a year to go, it’s evident that software developers, tax agents and their clients must come together as one big team and focus on one thing; the next phase of Making Tax Digital is coming, and we must be ready.

“Software developers are moving too slowly.”

We can (kind of) agree on this one. Agents are desperate to get their hands on software and start onboarding clients. And trust us - we’re desperate to put that software into your hands. The headache here is that we can’t go any faster than HMRC allow, and a few fundamental issues are holding us up.

Product Director of Tax Rob Ellis explains the roadblocks as “a pinch point unique to the current phase of the project.”

To be more specific, “it’s down to a combination of technical complexity, a very limited private pilot scheme and a lack of clarification on some legislative questions.”

The technical complexity stems from the structure of reporting under MTD for ITSA. With quarterly submissions requiring multiple data points and the two end-of-year submissions (the End of Period Statement and the Final Annualisation) pulling information from multiple digital sources, the development of MTD ITSA software requires much more resources and an experienced, agile mindset.

“Development’s been focussed on creating a user-friendly interface for self assessment and ITSA in BTCSoftware, and laying strong groundwork. It’s meant that we’re in a great position to offer customers a new way to process self assessment returns, and MTD for ITSA will slot neatly into that app. The software needs to work for our customers in all of what they do, and not just those few times a year they’ll need it for MTD for ITSA,” said Rob.

On top of that technical structure, agents are currently (mostly) unable to get clients into the private pilot scheme due to the restrictive criteria for entry, which is like the most exclusive club in town right now. It’s meant that testing – in a ‘this is real life’ way – has been hobbled.

Rob clarified that “we know our software works. We know it works for customers and their clients. We’re just struggling with the rest of the tech industry to evidence that in a live situation.” 

“My clients just don’t want to know.”

Don’t we know how that feels? An important step when onboarding new customers onto Bright software products is rolling the software out to all users – even the stubbornest users – in a business and ensuring they all know it’s available. The ‘how to use it’ element follows closely behind, but that first step is crucial; we know your staff need to buy into the software’s value to your business, just like your clients need to buy into MTD for ITSA’s benefits to them. Your profitability depends on it – not to mention the headaches you can ease by helping them believe in the scheme.

So that same challenge exists for MTD for ITSA; if your clients don’t get on board with the benefits, they won't be as easy to transition when the time comes. How do you do it when you’re time-poor and in the thick of busy season?

Marcus Bellis, VP of Sales at Bright, advises accountants and tax agents to take the opportunity to look ahead and assess what other services might be helpful to their clients alongside MTD for ITSA.

“When we sign up a new customer for Bright, we immediately look ahead to onboarding. Part of that assessment includes how we can support the customer in sharing the benefits with their wider team,” says Marcus.

“As a software partner, we’re not just looking at customer software headaches. We’re approaching their business headaches in the context of software. And when it comes to bringing clients into MTD for ITSA, agents can take a similar approach by looking holistically at the client’s broader needs. Perhaps they’ve been using Excel and struggle to see the bigger picture. By introducing digital bookkeeping as part of the solution, you can help frame MTD for ITSA as a transformation, not a restriction.”

Did you miss us at AccountingWEB Live Expo 2022?

That’s a shame, but it’s not too late to say “hi”. Head to brightsg.com to find out more about what we’re all about (brilliant software for brilliant people!)  or go straight to our book a demo page to see how we can help you.