Helping clients make the transition, and ensuring your firm has the right internal processes in place is still no easy task; so, the extra year doesn’t change the amount of work needed, just the timetable.
Although frustration exists around not having the full details available from HMRC, we should proceed on the basis of what we know now - which is the cohort impacted, digital record keeping, and the new update regime.
The project plan
Working out how to get from A to B might be relatively straightforward in your mind’s eye, but there is nothing like a project plan to iron out the finer details. Clients inevitably create complexity and the absence of detail on certain points of the proposals makes in-depth planning harder. But it’s good to have something in place that you and the team can all point to.
Segmenting your clients is really useful as part of this process and was covered in our client segmentation article. How you segment will vary depending on the particular circumstances of your firm, but spending time creating client type groups will help you be on the front foot in terms of who should be prioritised and why.
A key benefit of this segmentation should be that you also gain greater clarity around what services you will need to offer your clients. Simple segmentation around how much support a particular client might need would then lead into what service would be appropriate. Some may require a relatively hands-off annual approach, others checking and submitting the quarterly updates, and others a complete outsource option.
Tying client needs to service delivery, makes it easier to then think about timelines, and who needs to be communicated what and by when as we covered in our content calendar and content plan articles.
Ensuring you have the right software options
Spending time on your client segments and service offerings also helps define what software might need to be offered and what other tech you may need as covered in our choose the right tech for your practice article. What will best suit the inclinations and abilities of the user isn’t a bad place to start. Nor is selecting systems that will help you to make back-end processes more efficient and scalable for your practice.
While it might be too early to commit to a single approach, reviewing what is out there will do no harm - especially when thinking about client-facing tools. It is likely that you will need a compact range of options to cover the bases, and the sooner you can create the shortlist the better.
Remember that you are important to the vendors and they will be keen to secure your business. Talking to them about their MTD readiness and what kind of contract they might offer is an important part of this phase. And it all takes time.
Sorting out messages and timings for clients
There’s a lot to do here, and we went into more detail in previous articles in the series, but the best place to start is with communication. Given that it is likely that you will have to remind clients many times before it hits home, it’s worth starting as soon as you can.
General broadcasts, even of high-level details, making sure your clients know whether they will be affected and how you’re going to be helping them through the transition are better than no information at all. Over time you can move to more tailored responses, but to begin with, getting the main message out is important to help prepare the way.
Waiting until the last 12 months or so may only compound the challenge, especially with those that will be reluctant to conform. Starting as early as possible should also help shake the tree with those who are already thinking more about digital or are confident in making the move, leaving you with more time to deal with the rest.
Agent Services account
MTD for VAT exposed many areas of weakness in HMRC’s plans, perhaps none more than with agent accounts and signing up clients. There have been numerous promises that this will be better for MTD ITSA, including the ability to sign clients up from April 2023 (without them needing to file digitally immediately) and that it will be largely a digital process.
While it’s hard to predict if it will actually be easier this time, it should be seen as a positive step to helping with more of the back office preparation that needs to be in place. Planning for the switch and putting aside time to move clients once the system is ready (likely to be after April 2023) will mean no mad rush is needed ahead of the deadline.
Internal processes
Although the major challenge will be around getting all the data from your clients, you will still need to be on top of the internal processes. There could be an enormous amount of data coming into the firm, and with only a relatively small window to file the updates; so making sure you know what’s coming in, when it’s coming and how it will be handled deserves attention. In fact not just attention, but testing, and testing under stress too.
- How will you monitor client data collection and MTD submissions?
- Will your systems and people cope?
- Who will do what and when, and does this scale?
- What is the contingency plan if things go wrong?
All perfectly straightforward questions that need to be answered, and put through their paces.
Mapping these processes with the whole team can be useful, especially as it is likely that they will be running things moving forward, and they will be well aware of where things might need tightening up.
Keeping your project on track
You can set yourself targets, or you can just monitor progress, but either way, ensuring you know where you are as time progresses will help to keep things on track and mean you know what you are dealing with.
Choosing a small number of KPIs to monitor and track is a good place to start. For example how many clients have:
- Been contacted
- Started trialling software
- Been registered for MTD ITSA
- Had updated letters of engagement.
Keeping all this data on a spreadsheet might be the easiest way to manage things. It can also bring home the scale of the task once all the clients are listed out. Seeing things in black and white is always a good reminder of how the clock is ticking.
Getting there
Regardless of your approach, not waiting for the last minute before choosing to act is likely to mean that you can deal with problems early, and give yourself the breathing space needed to get the last ones over the line. April 2024 doesn’t actually seem that far away.
This is the final article in a seven-part series from AccountingWEB sponsored by Sage. You can access all of Sage's MTD resources and support on the Sage MTD Hub.
