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Podcast: MTD - VAT challenges

18th Aug 2017
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Last month we saw the government confirm a revised roadmap for its Making Tax Digital (MTD) project, with the requirements for digital quarterly reporting being stripped back to cover only VAT.

Joining the pod this month to discuss this new-found emphasis on VAT are Margaret Curran, Technical Officer from the Chartered Institute of Taxation, Gary Jacobs, director of accountancy practice Eazitax, and Thomson Reuters’ Product Manager – Tax, Mark Purdue.

During recording Curran expressed concern about the perceived oversimplification of the project now the emphasis has moved on to VAT, and highlighted the fact VAT records are kept in a whole variety of ways and subject to many different adjustments.

Jacobs, meanwhile, felt that as a firm currently working with HMRC on the MTD pilot he hadn’t seen anything specifically change.

Mark Purdue highlighted the crucial role that agent services will play in the success (or otherwise) of MTD.

The Making Tax Digital podcast is recorded on a monthly basis. If you have any burning questions you can ask them in the comments box below and our panel will do their best to answer them next time around.

You can listen to the podcast by clicking play on either of the windows above or below, visiting our Soundcloud page or subscribing to this podcast via iTunes, aCast, Soundcloud or your podcasting app of choice.


Replies (2)

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Tom Herbert
By Tom Herbert
18th Aug 2017 15:32

Apologies one and all for the quality of my microphone. It was fine testing the audio equipment, but seems to have given up the ghost when recording the real thing. Hope it doesn't affect your listening pleasure too much...

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By Graham Pears
07th Sep 2017 20:46

I found the comments from Mark Purdue more enlightening that almost anything else I’ve managed to unearth on this subject – and that is because they came from a developer whose software is part of the HMRC pilot.

Apologies if I am misquoting in what follows, but this is what I took away from this podcast:

The HMRC target is that MTD for VAT will go live from April 2019, with a live trial beginning probably from April 2018 – as Mark said. Yet here we are in August 17 and he says he has had no formal meetings with HMRC to discuss the processes or the data that HMRC is expecting. He says these are ‘very early days from a software perspective’ with regard to MTD as applied to VAT; and that he expects to start having some interaction with HMRC probably around October-Nov this year. The podcast ends with him confirming that “the software houses have got a big hill to climb”. And these are just a few of his comments that I have picked up.

Now I may be naive, but is there really any prospect of all businesses over the VAT threshold, which means all their various accounting software providers, suddenly and magically becoming compliant with complex data, processing and reporting requirements to satisfy MTD for VAT by April 2019? Even those undertaking the pilot haven’t the vaguest idea of what the requirements will be; so how on earth are all the other software packages going to meet an April 2019 deadline, especially given that the pilot won’t even START until April 2018?

Surely there will have to be quite a lengthy interim period in which simply-extracted information can be cut and pasted into some form of MTD-VAT-compliant software that forms a link between the multitude of accounting packages currently on the market and the HMRC data collection/submission process. Are all businesses above the threshold really going to be running on MTD-compliant software on or before the April 2019 deadline? That sounds somewhat fantastic.

Am I wrong, and if so why? What have I missed?

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