Software developers using the live MTD for VAT filing mechanism have encountered inexplicable errors in the data being returned by HMRC’s systems.
A thread on the GitHub developers’ forum this week flagged up inconsistent responses and inaccurate data coming back from HMRC’s network after VAT returns have been submitted.
In some cases, the live MTD system is sending back confirmation messages, but omitting reference numbers. This could be inconvenient, as in some cases users have contacted the MTD online services team after getting an acknowledgement email, only to be told that their returns haven’t been submitted.
One developer explained that the problems appear to stem from HMRC’s Get Obligations API sending back dummy data, demonstrated in tables showing obligations that predate the implementation of MTD and other obligations marked open, even when a subsequent column shows a return filed date.
An HMRC spokesman said the problem had been identified and was in the process of being rectified. AccountingWEB is awaiting further details on how the data glitch came about.
One the frustrations voiced by the developers will be familiar to other tax software programmers and accountants with experience of HMRC “customer” service: “The software developers support team won't investigate individual cases because they don't have access to the data, the MTD helpdesk won't discuss the issue with the software vendor because they'll only talk to the business, and neither the business nor the MTD Helpdesk has enough technical knowledge to discuss the issue in sufficient detail.”
The API issue comes at a time when developers are under the cosh to rewrite their VAT submission headers to include fraud-prevention ID codes. This requirement was only notified to developers last month, and was accompanied by the threat of a £3,000 for failing to comply.
The reaction from developers contacted by AccountingWEB to the new technical requirement was essentially a resigned shrug of the shoulders – the extra cost and rework is something they get used to get used to when working with the tax authorities.
But the penalty for non-compliance is a different matter. This is the first time that HMRC’s software partners have been subjected to a potential financial sanction, at a time when the tax department is relying on them to supply free and low-cost software to enable businesses to comply with MTD.
In private conversations with developers, HMRC officials have assured them that they have no intention of actually imposing the fines. But why enshrine the power in the first place, particularly in a statutory instrument that is not subject to parliamentary debate?
The business software trade body BASDA expressed disasppointment about the measure and the lack of consultation surrounding it and has been pressing the tax department on why this Draconian approach was necessary.
HMRC, meanwhile, challenged that interpretation and said, “The fraud header information has been on the Developer Hub since 2017 and developers were reminded about this in October 18. The spec was finalised in December 2018 and this was communicated to all developers.”
The current fraud prevention guidance (version 2.3) setting out the transaction monitoring header requirements was issued on 23 March 2019.