Six years down the line and HMRC has finally drawn a line in the sand on iXBRL.
From November 1 onwards, the tax authority will now reject company tax returns with accounts or tax computations which are not in iXBRL format.
Since 2011, it has been mandatory to file virtually all company tax returns online using XBRL tags for accounts and tax computations. Simply speaking, it makes company accounts and tax computations legible to HMRC’s computer systems.
Incorrect returns will need to be refiled in iXBRL, and if a return isn’t refiled by the filing date, a late filing penalty could be levied.
The only exceptions to the rule, according to HMRC, are if the directions under SI 2003/282 allow otherwise or a special dispensation has been granted by HMRC.
HMRC explains in its Agent Update that the majority of returns that HMRC receives are in the correct format, but a significant number still aren’t.
“When iXBRL was introduced it was very challenging for a lot of people. But there were ways around it,” said Anita Monteith, a senior technical manager at the ICAEW Tax Faculty
According to Monteith, HMRC’s minimum tagging requirement meant you actually needed a relatively small number of key items tagged to get your information through the government gateway.
“A number of companies realised that was all you needed,” she told AccountingWEB. “In particular if you chose a solution that involved having the packaged tagged freehand, it was possible to save yourself a little time.”
It’s this shortcut that the tax authority is now clamping down on. “My understanding is that HMRC has said, ‘we’re six years down the line, it’s time to sort it out’. So unless you’ve got a proper exemption, they’ll start rejecting those sets of accounts.”
About Francois Badenhorst
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