Member Since: 6th Oct 2004
10th May 2017
The most important thing is that we don't have to waste time thinking about it any more - business as usual.
But why., oh why, didn't they get their act together on this sooner?
24th Nov 2016
Excellent article Jennifer - and I agree that our institutes have been nowhere near vocal enough. Sadly, par for the course.
What bugs me most about this is HMRC's dishonesty. They won't come out and actually say why they want quarterly reporting - we all know that "helping customers to be more aware of their upcoming liabilities" is just tosh. We all know what the agenda is, but HMRC will not admit it. Professionals do not like being lied to. Especially when we know that the lie is necessary to avoid having to say "we don't trust you".
Our institutes should have called them on this dishonesty - but I suspect too many vested interests prevent it.
When you get right down to it, all HMRC should actually want is mandatory digital annual reporting (ie the year end report). If they just stuck to that 80% of the furore would disappear, because we pretty much already do that for all our limited company clients. Yes, there would be some transitional issues, but we'd put up with them for the long term efficiency.
Somebody at the top needs to get a grip.
29th Sep 2016
Andrew Hubbard hit the nail on the head in his editorial in last weeks Taxation when he said that, until the government make the case for quarterly "updates", they will not get the profession to back these changes.
Certainly, from where I sit, I cannot see there is any kind of case for quarterly reporting. The only reason I have seen advanced is that it helps taxpayers to have an idea of estimated tax liabilities. But that is palpable nonsense.
So I shall continue to oppose MTD for the time being.
8th Sep 2016
But, as a prerequisite of buying a smartphone, I require it to do (as a minimum) what a dumbphone did.
The problem with online mobile software is that it doesn't do what the spreadsheet did.
So online mobile software is something new - it is not evolution. It's a reinventing of the wheel. Why mess with the wheel when it works so well?
8th Sep 2016
What is key about spreadsheets is that, for non-accountants, they are visually so much easier to look at an understand than accounting software. Which is why there are still so many businesses out there that, even when running accounting software, also run an analysed cash book either in excel or manually.
All that will happen with MTD if HMRC don't allow spreadsheets is that spreadsheet users will carry on as before and upload quarterly totals to a compliant app and submit just those totals. As soon as HMRC realise this then they will work out that they might as well allow spreadsheets.
2nd Sep 2016
I'm interested in your argument that the reason for making a profit would have to be more than 50% of the reason for acquisition.
You want a tax case to prove it - but I'm not sure I agree. The legislation refers to "one of the main purposes". If your view is right there can only ever be one main purpose - for the obvious reason that once one reason is more than 50% of the total, then all other reasons must by definition be less than 50%.
So the fact that the legislation refers to multiple main reasons must, it seems to me, mean that a main reason for these purposes can be something less than 50%. But quite where the dividing line between a main reason and a "non main" reason lies is unclear.
In practice, it requires HMRC to get inside the mind of the investor at the time of the purchase. So I suspect that the use of this legislation will be reserved for the most extreme cases. It's a bit like the anti avoidance on transfers of income streams. On the face of it, that legislation could be used to recharacterise a lot of transactions that are subjected to CGT - but HMRC almost never tries to do it.
18th Jul 2016
As Justin said, the facts were against the trust argument. The case report is an interesting read, and the tribunal chairman could easily have found the other way if he'd wanted to. The best thing about the judgement is that it shows that, in most situations, there would be a way out.
3rd Jun 2015
@andrew.hyde has hit the nail on the head.
There is a world of difference between structuring something using tax law as parliament intended it to be used and structuring something other than with parliament's intention. The former (in my book) is fine - the latter is not.
Quite a few of the posters on here seem to be saying something along the lines of "if you can't write the law well enough to stop us doing something which is not in accordance with the original intention, then tough". It's that kind of attitude that, in my view, rightly brings the opprobrium of society down on the heads of the tax profession. That attitude is the mentality of the criminal.
I know people will say that you can't always devine what the intention of the law was - but it can't be beyond the wit of man to fix that.
18th Sep 2012
So - just to be clear about how to get out of an audit....
It can be done for any current year end from 31st March 2012 or later (if you would now qualify for exemption under the new test) by:-
1: Extend the year end by changing the accounting refernce date to 30th September (if it isn't already)
2: Have a board meeting and resolve to make up the 2012 accounts to 1st October for this year only.
.. er, that's it.
This is because the SI refers to "financial year". A financial year is defined by CA 2006 S390 as starting on the day after the last day of the previous financial year and ending on the next ARD or a date determined by the directors being within seven days either side of the ARD.
So there is actually no need to extend the ARD to 1st October at all.
Does anybody disagree?
22nd Feb 2012
Horses for courses
For many thousands of small businesses (one man consulting businesses etc) there is absolutely no need for anything other than cash accounting - they lose no meaningful information that way.
But for an "real" business buying or selling on credit and possibly holding stock cash accounting is hopeless.
So our job as professionals is to push those who need it (but only those who need it) towards not going the simplified route.
Much better simplification would be to do away with all the disclosure garbage in limited company accounts so the client sees just what matters - a P&L and balance sheet. That way there is at least a chance they'll understand their business better.