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Lord Carter proposes October SA filing deadline

22nd Mar 2006
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The publication of Lord Carter's review of the Revenue's online services was not mentioned in Gordon Brown's Budget speech, but contained some of the most controversial and far reaching proposals of the afternoon.

The review set up under Lord Carter of Coles following last year's Budget indicated that Gordon Brown and his Treasury team intended to put e-government at the centre of their reform programme. Originally due for publication in the autumn of 2005, Lord Carter was given an extra few months to research his recommendations, which include:

  • Requiring businesses to file their VAT returns, PAYE in-year forms (P45s and P46s), and company tax returns online; the phased approach would start in April 2008.
  • New, shorter deadlines for filing Self Assessment returns - from 2008, paper returns will be filed by 30 September, or 30 November for those filed online.
  • To encourage individuals and companies to file early, the enquiry window will apply from the date a return is filed.
  • Substitute paper returns generated by tax software programs will no longer be accepted from 2007/08, forcing advisers to file their clients' tax returns online.
  • Mandatory online filing of Corporation Tax returns, using an enhanced version of XBRL (eXtensible Business Reporting Language), from 2010.
  • An electronic payment facility on the HMRC website, with a harmonisation of the current payment rules so people can pay them all electronically.

    The proposal to shorten the Self Assessment deadline by four months (with a two month extension for online filers) would have the most universal impact on taxpayers and their advisers. Speaking on Radio Five Live, Smith & Williamson tax partner and ICAEW Tax Faculty chair Francesca Lagerberg commented, "At the moment we struggle to get paperwork in by the end of January. Lord Carter suggests bringing it forward to 30 September, or a little later. That's a huge change."

    In answer to such complaints, paragraph 4.7 of the review quotes the OECD's view that UK filing deadlines are usually long compared to other countries, where the average is five months. "These long deadlines have restricted the scope of HMRC to offer additional time as an incentive for online filing or to work co-operatively with agents to spread the workload," the report claimed.

    The HMRC press notice characterised Carter's report as setting "an aspirational goal for HMRC: to aim for universal electronic delivery of tax returns from businesses and IT literate individuals by 2012".

    The report itself is presented as a series of recommendations, but the department's response appears to be based on the assumption that it will be moving towards implementation. An HRMC official said that consultations would now take place with businesses, taxpayers, advisers, software companies and consultancy bodies on how to take the recommendations forward. There will also be a series of roadshows later in the year.

    The department plans to invest £340m in online service infrastructure over the next nine years. It envisaged realising savings of more than £250m by 2012/13.

    The government makes a great show of consulting with stakeholders - evidenced by the parade of consultation documents, regulatory impact assessments and so on - but organisations that submitted evidence to Lord Carter indicated that they heard hardly a peep back.

    While he may have held his cards close to his chest, Carter appeared to have heeded some of the complaints he received. The report noted tax agents' concerns that HMRC's online services had not always been designed with their needs in mind, and further complaints about the inability of various HMRC online services to cope with the workloads.

    In reponse, Lord Carter made a series of recommendations to address the issues raised. The suggestions included a new agent registration scheme and allowing advisers to file returns on behalf of clients who had not yet submitted agent authorisations. Also proposed were a regular email newsletter on online services and regular agents workshops, possibly in partnership with software developers.

    For software developers, the Carter report suggested they be given a minium of six months' testing time before any major changes to tax returns or online services are implemented. More rigorous testing was highlighted as one of the major "building blocks" to deliver robust, high-capacity online services.

    "Each of the services should be capacity tested at least a year before our recommendations are implemented, and if any tests are not successful the measures relating to that service should be deferred," the report recommended.

    TaxZone columnist Rebecca Benneyworth commented: "I accept that online filing is the only way to go and they've made the decision.

    "But the fact they have decided to change the filing deadline without any discussion at all really is quite high handed. The Paymaster General has said they will take forward the consultation process with businesses, but what is the point in having discussions when they've already made decisions?"

    Agents will no doubt get their chance to air their views at workshops and roadshows in the coming year. Until then, you can always share your views with AccountingWEB members by clicking the "Post a Comment" button below.

    Related material

  • Review of HMRC Online Report (520k PDF)
  • Partial Regulatory Impact Assessment for increasing use of Online Services
  • NAT 21/06 - Improving take-up of HMRC online services HMRC news release
  • Mandatory e-filing on the way? by Rebecca Benneyworth, Oct 05
  • HMRC Online services ' What do you think of it so far?

Replies (42)

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By Pauline7372
03rd Apr 2006 17:45

I was on holiday on budget day and I'm still catching up on the reading. I'm a bit concerned by the comments of Liz Zitzow (24th March). My main concern relating to the Carter report changes is the lack of consultation/debate; I would be equally disappointed if the FSB took it upon itself to lobby without first polling the members. Personally, I like the idea of an earlier deadline. My objective is to bring most of the work forward by encouraging clients to work on a quarterly/monthly basis; an earlier deadline would support that aim. I do see problems with the proposals not related to the pressure on accountants - not least of all, the ability of HMRC to bring systems up to sufficient standard and capacity to cope with the massive additional burden. Every accounting firm has different circumstances and, predictably, the negative reaction is the first to be heard.

The "overwhelmingly negative comments ... in" don't necessarily represent the views of 100,000's of FSB members - many of whom (incidentally it seems) are not accountants.

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By John Adamson
30th Mar 2006 08:47

Filing deadlines
Rather than "reinventing the wheel" does anyone already have a suggested letter to write to MP's, Gordon Brown and the like?

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By Helen Crowley
23rd Mar 2006 09:27

As a Tax Manager I will certainly look forward to Christmas in 2008 unless of course we end up becoming seasonal workers as our employers are unlikely to want us having huge amounts of non-chargeable time for 4 months! That would mean being laid off each year at Christmas! Unless of course we can retrain our tax teams in order that they can do other work. Any ideas?!

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By AnonymousUser
22nd Mar 2006 20:14

I think this could be positive

When I first read about the deadlines changing for SARs, I was gobsmacked.

However the more I think about it, the more I think its positive.

We struggle to do 12 months work in 10 months at present, and have to write off December and January – I haven’t been able to enjoy the run up to Christmas since 1996.

We cannot do 12 months work in 6 or 8 months, its just not possible.

So we will have to redefine the way we work, and how our clients present stuff to us. I think that will in fact, with some organisation, result in a smoother workload.

Historically my practice has guided clients towards 5.4 or 31.3 year ends, but my guidance to my managers as off tonight will be to move away from that and start to spread the workload.


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David Winch
By David Winch
23rd Mar 2006 10:27

Response to Trevor


I do not think anyone is suggesting that submission of self assessment tax returns on paper will not be allowed.

However it is proposed that with effect from 2007/08 paper returns should (i) be received by 30 September and (ii) be on Inland Revenue printed forms (and not substitutes produced by private sector tax software).

Whereas submission of returns online (i) should be received by 30 November and (ii) may be made using tax software (whether from HMR&C or the private sector).


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Nigel Harris
By Nigel Harris
22nd Mar 2006 17:06

The proposed 30 September and 30 November SA filing deadlines are going to impact both the profession AND the Revenue. Both have enjoyed the ability to spread the annual SA workload over 10 months each year. I am not convinced that either currently have the capacity to deal properly with this work in less time.

Is this definitely going to happen in 2008? This doesn't give us long to get ready for it. There is a huge amount of re-education of taxpayers required - not to mention the need for tax staff to get used to taking their annual holidays between December and March each year! We have accepted that few Returns are filed before September because of annual holidays and the need for tax staff to deal with P35s and P11Ds before the Summer.

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By AnonymousUser
23rd Mar 2006 09:09

I'm all for online filing but it has to be made easier - or more reliable - to register clients with HMRC. Having to ring Online helpdesks because you have submitted 64-8s and your clients are not showing up on either the HMRC site, government Gateway site or both is not aceptable.

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By daveforbes
22nd Mar 2006 15:56

Major oversight on end of year returns
As we have pointed out to HMRC, the Filing by Internet system only ever accepts a single year's returns - unlike ELS, which had a moving five-year window. This is a major oversight.

Lord Carter says agents will have to file electronically, but this will mean agents will have no way to submit out-of-year returns automatically. If HMRC will not accept paper facsimilies, you'll have to get out your biro to submit them if you're any later than 6 April (or before too long, 1 December). Some accountants do a lot of these - I'd like to know how many out-of-year returns HMRC gets.

The filing infrastructure needs to cope with multiple years, which is a major undertaking that will need to be completed before Lord Carter's deadline.

David Forbes
Forbes Computers

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By wfewtrell
23rd Mar 2006 11:26

No substitute forms? Why?
I agree with David below. John's article is a little confusing in that he states that online submissions from tax software will not be allowed, as that is not what it says in the press release.

What I am still struggling with is why, on those occasions where a paper submission is needed the press release states that they want to "promote online filing by tax agents and better quality data by withdrawing computer-generated paper "substitute" SA returns from 2007-08". The implication here is that you will have to request a return and fill it in manually. Bearing in mind most accountants handwriting I can't see how this provides better quality data!

Also for those self employed clients with a long accounting period, change of accounting reference dates, etc. you cannot currently file these by FBI and have to print out paper returns (we use IRIS). These paper returns are, I am reliably informed, pre-approved by HMRC, even to the point of approving the appearance of the "tick" in the tick boxes!!

One of the key conclusions of the Carter review (having just read it) is that they will have to ensure their systems are robust and rigorously tested before implementation of any of these proposals. Anyone heard that before??!

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By Robert Clubb
23rd Mar 2006 12:30

Beginning to lose it......................
Warren is missing the point, the reason why the substitute Returns are being withdrawn is that HMRC don't want to continue spending the time approving the software versions when it does not, in their view, seem to benefit them.

This appears to be very short-sighted on their part but, I have to say, it's the nature of the beast we are now having to learn to live with. The current catch phrase is 'Providing a better service. It should be amended to 'Providing a reduced service and learn fend for yourself mate!'

As for the shortening of the submission window, perhaps Civil Servants only work 8 months of the year and they are confused? I agree with Daniel that we are likely to be filing many more 'provisional' Returns than ever before.

As for me.....well I had intended having some time off in October 2008. Looks like there is a fat chance of that now. What with UITF40 this coming January, I probably won't be able to afford any more holidays anyway.

Happy days.

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By AnonymousUser
23rd Mar 2006 11:32

Spread self-employed year-ends throughout the year?
I would be very reluctant to move away from 31 March year ends.

When SA arrived I migrated 99% of my self-employeds, of all sizes, to a 31 March year-end. Most of them had been 30 April and we used the two-year-averaging period to 'lose' the impact of the change.

I had two reasons for this:

I foresaw that keeping to 30 April with an 11 month overlap period and with overlap relief frozen in terms of 1997 pounds and 1997 profit levels our clients would be sitting on a time bomb in later years when cessation (inevitable, of course) required use of the relief.

Second, i wasted huge amounts of time trying to explain to clients exactly what profits had been taxed and what year their tax payment was covering. It was even worse where SC60/CIS tax had been deducted. 31st March year ends saved me time, reduced client confusion enormously, and eliminated the chance of conflict with the clients who got unexpected (by them) tax bills.

I have been proved sadly right since then because all these problems have arisen with subsequent clients taken over from accountants who perpetuated the 30 April year end. (Yes, I know there's a tax cashflow advantage at startup but try defending that to a client with a big cessation tax bill and only a few quid of overlap relief!)

I cannot countenance changing accounting dates and bringing back all the above issues. And would a client faced with an unexpected tax bill be sympathetic, and non-litigious, if our justification was that we did it to ease our workload?

But equally the thought of getting it all done by 30 November is horrifying. I am already thinking about having longer office working hours from May to November.

Memo to self: must investigate skiing!

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John Stokdyk, AccountingWEB head of insight
By John Stokdyk
23rd Mar 2006 12:16

My error on outputs from tax software
Thanks to Warren and David for alerting us to the miswording in the original version of this article that suggested "returns from tax software" would not be accepted from 2007/8...

I'm sorry that mistakes occasionally occur in the rush to get big news stories published on Budget day. I have amended the wording to make it clear the restriction applies only to facsimilie forms printed out from the applications. Apologies to anyone who was unneccessarily worried by the wording.

John Stokdyk
Technology editor

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By Robertnz
23rd Mar 2006 12:34

Self Assessment changes
There is an old saying - if it isn't broken, don't fix it.

Without reading the full report, I cannot see the purpose in changing the FILING deadlines, if there is going to be no change in the payment procedures.

I can therefore only assume that waiting in the wings is another Gordon Brown nasty, bringing forward the payment date for at least the settlement tax payments of the finished year forward, to give the Treasury a on-off improvement to their cash flow.

If I was cynical, I could suggest that bringing the deadlines forward would be solely for the purpose of generating more revenue through late-filing penalties.

The other item is that, with the withdrawal of the ELS system at the end of this month, we are left with the FBI system which, based on my own experiences, is slower, less functional and more disaster-prone than ELS.

So much so that I received notification today from Public Department 1 tax office, that they cannot accept FBI filing of the return for one of my clients (while happily accepting ELS returns in the past) so that for 2005/06 I am going to have to file his return by paper!!! And an individual at the PD1 call centre admitted that "10s of thousands of tax payers would be affected in this way" and that the Revenue IT management have failed to handle the situation which has been known about ever since FBI came into existance.

How many more billions of tax money are going to be wasted based on the bright ideas of Labour-appointed theoreticians without a practical cell in their body, being paid substantial fees to create unworkable chaos.

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By daveforbes
23rd Mar 2006 11:31

paper forms
It is not handwritten paper forms that are to go, it is computer generated ones. In paragraph 5.13 of the Carter "Review of HMRC online services", it states "we recommend that the HMRC should stop accepting SA returns on paper substitutes from April 2008". The idea being that you will not want to copy out the printed information onto the official form using a biro, so you will file electronically.

We have always lead the way on electronic filing, but as I mentioned in my first post, what will happen for out of year returns which are not supported by FBI.

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John Stokdyk, AccountingWEB head of insight
By John Stokdyk
23rd Mar 2006 15:14

Carter/HMRC rationale for dispensing with substitute returns
The regulatory impact assessment on Lord Carter's proposals includes some interesting facts and figures that underpin his reasoning.

Paragraph 22.25 of the RIA explains: "Nearly 30% of paper Self Assessment tax returns are currently submitted on substitute forms produced on computers using tax software products and then printed out and submitted by post. The vast majority of the software products can be used to file online. More than 90% of these substitute returns are produced by tax agents.

"22.26 Printing and re-keying these returns is a wasteful process that can introduce error into the clean data produced by software. Substitute returns are also more difficult to scan meaning that, even where optical data capture processes are available, manual intervention is frequently necessary. For these reasons Lord Carter recommends that HMRC should stop accepting paper substitute SA returns from 2008."

The assessment estimates that 1.4m taxpayers will be affected by the elimination of substitute returns (and the changes to the filing dates), and in a later table quotes figures from an MYOB survey that online filing will save the agents who generate substitute returns (and their taxpayer clients) between £18 and £25 per return for simple returns, rising to £90 for more complex ones. Another table estimates the savings to taxpayers of switching from substitute returns to online Filing will be in the region of £25m-£35m from 2012.

The report provides some further estimates on the costs and benefits of Carter's online initiatives. Overall, it revealed that the Revenue has so far invested £500m in its online services and plans to spend £340m in the next nine years.

Paragraph 22.47 estimates the total benefit for all taxpayers and businesses affected to be £175m-£247m pa from 2012/13, with businesses saving between £158m and £215m pa.

In addition to the direct benefits to taxpayers, there are likely to be savings of up to £59m pa for Government by 2014/15 on processing and administrative costs. "Part of these savings will be used to fund improvements to the service offered by HMRC to taxpayers," the RIA says.

John Stokdyk
Technology editor

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By daveforbes
23rd Mar 2006 16:58

approving returns
I don't believe the motivation for withdrawing substitute returns has anything to do with reducing HMRC resources involved in the approvals process. Most of the major tax software houses have self-certified returns since the introduction of SA and they only get a brief check. Hopefully the recommendations of Lord Carter will push the HMRC to improve their systems to include the exclusion cases. That or the returns will be produced and printed out on a computer and then passed to the scribes' department for copying onto the official forms !

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By tw.gillardwatson
23rd Mar 2006 17:07

Twelve months work in six months
One of the main reasons a work bubble exists towards January each year is the fixed length of time HMRC has to open an enquiry.

'Simplify' matters into two six month cycles (and keep the tax department reasonably fully employed throughout the year) by having an enquiry window closed on 31 March for all returns submitted by the previous 30th September, paper or otherwise. In contrast, extend the final filing date from 31 January to
31 March (leave paydates as they are with the current interest regime [review the 5% surcharge]), but the enquiry window runs 12 months from the filing date.

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Nigel Harris
By Nigel Harris
23rd Mar 2006 17:19

Thin end of the wedge?
Robert Stevens has hit the nail on the head. What's the point of a real-time e-filing deadline that's two months before the payment deadline? This looks like a move to accelerate tax revenues for the Government. What's next? Once the 30 Nov deadline beds in, why not cut it to 30 September for ALL returns? The UK will still have a longer filing window than many other countries.

Not that it helps our profession, of course.

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Rebecca Benneyworth profile image
By Rebecca Benneyworth
24th Mar 2006 06:57

And another thing....
What about claims and elections, for which all deadlines were moved back to January in 1996/97? Will the dates remain January, or will these be moved, and if so to where?
I suppose I ought to mention (as a mum of 5) school holidays too. In my part of the world you are virtually shot at dawn if you want to take children out of school during term time, and I suspect many tax staff will still need to take a short holiday in the summer.
And on a self interested note....when do I get to deliver my Finance Act 2008 courses, which are currently sitting in my diary in September to November 2008? When will anyone get a chance to do any CPD? December to February. Oh that's OK then, we'll just confine tax changes to those three months....
Is being resistant to change a sign of increasing age? If so, I've aged quite a bit in the last 48 hours! Reorganising everything is not impossible, but to do so in the time available - two years - is a big ask!

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By AnonymousUser
24th Mar 2006 09:18

Change of Self Assessment deadlines
If the filing deadlines were brought forward it would be impossible for me to carry on as I am - I would have to reduce the size of my practice, as I simply wouldn’t be able to cope with getting all the returns in two months earlier.

My practice is very small and I work entirely on my own, and nearly all my clients are sole traders, partnerships or personal tax clients, and the majority of them now have 31 March year ends. I therefore work for 9 months from May (nobody had their tax return information ready before the end of April) to January on tax returns and accounts, and I don’t have enough work to do from February to April.

If the deadlines were brought forward, it would be impossible for me to do the same amount of work in 7 months instead of 9, and I don’t know what I’d do for the other 5 months.

Maybe it’s time for a career change - or, maybe I should consider early retirement!

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By tracyc.tiffingreen
24th Mar 2006 15:44

"Get Carter"
Who is Lord Carter and how is he qualified to make these recommendations? Anyone would think that accountants hold onto all completed tax returns until 31st January - like we have time to submit 1000+ via FBI all in one go - that would bung up the gateway!
When it is stated that our filing deadline is longer than that of other countries, are they comparing like with like, what about the complexity of the tax systems and the year ends?
Where is "working together" in all this? Who is it that has been consulted? - can't be the people that actually do all the tax work.
Wonder what the staff in the tax offices think of it all.
This is one annoyed tax department. How are we to be expected to do the same amount of work in a shorter time period? Thought this Government liked to espouse that everyone should have a healthy work/life balance. Is that not to apply to the accountancy/taxation profession?
What are the chances of our views on all this being listened to - we are the ones that actually do the work, after all.

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By John Savage
24th Mar 2006 12:50

Thanks Stephen...
for those e-mail addresses. My e-mails of objection have been sent.

Whether anyone will be listening to us is doubtful somehow. This Government listens to no-one!!!

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By John Savage
24th Mar 2006 10:45

If the filing date...
for companies is also being brought forward from 10 months to 7 months, I just cannot see how the accountancy profession will be able to cope.

Has Carter not consutled with us before he came up with this 'brilliant' idea? We don't have access to the Government's millions of pounds of wasted budgets, huge overspends, thousands of mollycoddled staff who are, half the time, off sick on full pay etc etc. Most of us work on tight deadlines with limited finite resources.

Perhaps if Carter and HMRC were to actually 'work together' with us, then I feel sure a realistic way can be found of solving some of the problems with SA. But, of course, I forget, these ministers and civil servants 'know it all'!!!

I don't like to think that a democratically elected Government could have a hideous subplan i.e. make filing dates impossible to meet in the hope of increasing their yield by way of increased default penalties. Brown, Primarolo et al wouldn't stoop that low, would they??

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By DonQuixote
24th Mar 2006 15:08

Flat Rate & Annual Accounting
For those of us that are complaining that there will be too much work in not enough time, have we all taken advantage of the above 2 VAT schemes?

Flat Rate does not suit any of my clients, but I know Annual Accounting will save about 25% of my time, being that I will be doing the Accounts and VAT at 1 sitting instead of 5.

The reason I've resisted it until now is because of the quality of client record keeping and an initial bad experience with client cash-flow.

I wonder if the November filing window is a (very) roundabout way of pushing us into simplification.

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By salilp
24th Mar 2006 16:20

SA Deadline should be shortened
Why should self-employed pay tax almost after the year end as opposed to those on paye?

Lord Carter has taken a bold step by not spoiling and burdening my Christmas holidays? Why should only Accountants suffer the January Blues??

The bad clients, no matter what, have continued to deliver their records in late November to middle of January, and this will completely eliminate the possibility.

I know I might get lot of stick from my co-professionals, as I will feel the burden too of shortened deadline?? But think of the idea of going with your family on holiday during xmas and new year. In the last ten years I have never been able to do that since introduction of Self Assessment

This will also enable Agents to be regimental with their clients to deliver records within 6 to 8 weeks after the year end

I commend this statement to Accounting Web Pros!

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By AnonymousUser
24th Mar 2006 16:13

Given the overwhelmingly negative comments I've been reading here and elsewhere in, AND given the kind provision by Stephen Collier of the appropriate names, email addresses, and postal addresses along with the deadline for Treasury Committee comments, I have drafted a response to be sent by The Federation of Small Businesses (where I am an active member of the London Policy Unit).

The FSB lobbies on behalf of micro and small businesses. I will make sure that the FSB is lobbying this issue on behalf of it's 100,000's of members, many of whom are in the accounting industry and affected adversly by the earlier deadlines.

Silly aside - On the bright side, I'll be back home in the USA for Thanksgiving and Christmas for sure now.

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By John Savage
25th Mar 2006 10:21

So we must all urgently write to the Treasury Committee
This week-end all of us must lobby our points to the Treasury Committee regarding the impossible situation we face. Clearly Carter has never completed tax returns on behalf of clients, and has not the faintest idea of what he is talking about. This is just another Government puppet doing the Government's bidding.
Stephen Collier has placed e-mail links on his comment below.

The e-mail address is [email protected] by Monday 27th at 12 noon.

By the way, if you look at you will note that oral evidence to the Commons Select Committee is being given by the Institute of Fiscal Studies, Morgan Stanley, Volterra Consulting, National Institute of Economic & Social Research; Manchester Business School & PriceWaterhouseCoopers!! Apart from PriceWaterhouse (and what do they know about the problems faced by smaller accountancy firms??), there is a conspicous absence of our professional bodies.

Thus we cannot leave this to our impotent representatives, they seem less able to advocate our interests as each day passes.

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Dennis Howlett
By dahowlett
27th Mar 2006 02:19

What's so unique about the UK?
The US is just coming to the end of tax filing season for the clendar year 31/12/2005. I'll be making my last tax return for my time in France in the next few days for the year ended 31/12/2005. I've already paid my first instalment for tax due for 2005, the others are due May/October.

By the way, those returns have to be backed up decent estimates or actual figures which are professionally prepared and which must be finalised by 31st July in the case of France (can be lengthened.)

What makes the UK so different that it can't deal with this?

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By Paul Soper
24th Mar 2006 17:01

Is the problem the tax year?
The drive to switch clients to 31 March was inevitable given the way that self-assessment was introduced but 30 April still had advantages of longer to plan, to sort out the paperwork etc etc. My guess is that very few practitioners took advantage of this because the return was still geared to the tax year. So until 5 April rolled round no attempt was made to deal with year end figures that had been available for 11 months by that time.

The only way for the profession to accomodate this change given the way we work is gear accounts preparation to the year end and the year end to be geared, as it should be, to the needs of the business, not the needs of the tax system.

Many, most self-employed clients have few other sources, and many would report sums on which there could well be no further liability.

So why not allow an election to change not simply the year end, but the tax reporting year for the client to the most suitable date, 7 months for filing, 12 months for investigation and then closed? Like CT instalments could be timed by reference to the accounting date. If the client was indifferent to the filing date you choose one to suit the work pattern through the firm.

Make sure that the change, once made, was mandatory for (say) 5 years.

If a clients business meant that September was a suitable year end the accounts would be drawn up, minor sources of income treated as business income, return filed 30 April, and a smoother flow of work for us, and the revenue through the year.

Clients with more complex affairs should be able to opt for a filing extension with a surcharge (NOT a penalty that is psychologically inappropriate) for the option to compensate the revenue.

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By susanna russell-smith
27th Mar 2006 09:36

Vote for Summer
We were perfectly able to cope with a 7-month 31 October deadline before SA came in, but that of course was when we had PY for accounts.

So why not lobby for a return to PY as the quid pro quo - or no questions asked when we change all the 31 March accounting dates back to dates of our choice earlier in the fiscal year?

Personally, I'd far rather have summer hols than winter ones, so I'd happily vote for an 8 month deadline if the fiscal year end was changed to 31 August. In fact, whatever the deadline, I'd really love that 31 August year end.

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By kevinringer
24th Mar 2006 16:55

Carrots are more effective than sticks ...
Efiling of PAYE has been hugely successful because HMRC offered a carrot and not a stick. Why not use this for Tax Returns – offer an online filing incentive, and the earlier you file the bigger the incentive. If anything will encourage people to file early then this will.

Personally I am very concerned about the early filing dates. Currently my professional time from March to September is taken up servicing existing company clients because unincorporated clients have not brought in their papers. The changes mean that the workload that is spread over 9 months (ignore April – no one will have had all their statements etc until late April) will now have to be condensed into 5 months (because the online systems won’t accept certain Returns, and until you complete the Returns you can’t be definite whether they will be accepted). How are we going to do this? Do we employ extra staff then lay them off the other 7 months? Ideally clients should let us have their papers monthly and we’ll do monthly bookkeeping thus reducing the year-end workload – but how many clients will agree to this.

There’s also the staffing issue. Most staff take their holidays April to September, so when things get busy November to January the only holiday is Christmas and I personally don’t mind working through that holiday. But if the deadline is earlier then what do we do about staff annual leave – ban it over the summer and only permit it from December to April?

I wonder how much consultation went on before Lord Carter came to his decision. Did he consult the Working Together teams? Perhaps he should have worked in an accountant’s office for a year to experience our difficulties.

Practice Assurance, International Standards for Auditing and now shorter filing deadlines? Who wants to be an accountant?

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By tw.gillardwatson
25th Mar 2006 10:16

Bringing forward the filing deadline in itself will be acheived by taking on more staff. Taking an extreme, 30th April is acheivable with ten times the workforce. The problem is not how early the deadlines become, it is what you do with the staffing for the remainder of the year, be it four months of non activity or eleven. The proposals are not an efficient use of man (or women)power. Idle time is going to be paid for by someone, either greater fees to pay the additional staff, fewer clients and lower practice income just to maintain a sense of normality, or a seasonal workforce with layoffs December to March.

Pre self assessment, how long did the Revenue have to deal with assessments. Prior year basis and all that - two years ?

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By vowlesj
27th Mar 2006 10:14

Only if the taxman helps us tho!
OK how's this for a real-life example, you send in the 64-8 and 4½ months later it gets processed, but the client didn't come to see you until 2 months before the sa deadline. You can't efile without agent authorisation - so if you can't do a paper return, who is going to pay the penalty?

This year I filed paper returns for about a dozen clients because of HMIT errors in processing (or not) the 64-8. Worst case example is a 64-8 submitted to the CA team in Newcastle on 28 October 2005 and not processed until 24 March 2006!

Lord Carter's amended deadlines should merely mean better It and organisation (both for accountants and for the taxman) and lots and lots of small print so that I am not liable to any penalties. However, it also means that HMR&C must stop being our adversaries and become helpful. But is that too much of a culture shift!

For example, how many other accountants spend over an hour simply trying to contact the tax office ... if HMRC is going to move over to call centre working then where is the dedicated call centre for accountants so that we get speed of response? Call centres might work for the taxman, but they aren't working for accountants and that needs to be fixed.

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By Robert Clubb
27th Mar 2006 08:55

Don't Destroy the Rain Forest
Mike, I suggest that you have a word with your software suppliers. Ours (Digita) is certainly proposing to produce a 'Return' for clients to approve. The only difference is that, whilst it will be your evidence, the format will not mirror the SA100 or, if it does, the format will not be 'approved' for manual submission to HMRC.

Therefore, only in the case of a manual Return will you need to ask for paper from HMRC.

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By ringi
27th Mar 2006 15:28

Spead out the load
What if an agent had to file returns on line for 60% of his/her clients before Oct 31, 90% on line by the end of Nov, and the rest by the end of Dec. You could allow the agent to file no more then 2% of return on paper to cope with the odd problem with the on line system.

If the number of return to file on line was set each week it would help greatly in spreading out the load on the computer systems.

The agent will of course have to do whatever it takes to get enough of his/her client to provide the information on time. E.g. charge a LOT more then clients that are late. An agent that does not meat the online filing deadline, should not be allowed to sign up any more clients until the get their act together.

To get tax payer to file there own return on line.
a) Send everyone that has to file a return a logon/password. I know of people that don’t file on line, as they only spend half a day a year doing there tax return and don’t want to wait for the password to come in the post.
b) Don’t send a paper tax form, if the tax payer wants to file on paper they should have to phone up to get the form.
c) Pre-fill the on-line form with details that the tax office already knows, .e.g. employment income.

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By User deleted
27th Mar 2006 22:39

Having heard about the proposed shortening of the deadline I thought it was a joke. Sadly this is not the case. As a small practice we tried very hard to file all of our Tax Returns online this year but due to failings at the Revenue end were unable to for several reasons.
Initially it was not possible to submit a non domiciled form without a DOM1 having been submitted (this was changed later).
Secondly double tax relief on capital gains cannot be dealt with by the Revenue software as these were rejected.
Lastly almost every 64-8 submitted since October 2005 has not processed correctly and we have had to telphone the online helpline wasting even more time to have this put right. We are still having 64-8's entered on the system per the Revenue offices but not appearing on the Gateway which is a must for online filing.
As a small firm with a tax department of two we struggled to meet the 31st January deadline. We'd have no chance with an earlier date unless we work 50 hours a week or more!

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David Winch
By David Winch
22nd Mar 2006 17:50

Crystal balls?

You heard it here first, in a comment on Practitioner's Diary on 17 January I said:

"This is probably heresy (so I will say it quietly) - would it be better for accountants if a penalty were imposed for a tax return received after, say, 30 November rather than 31 January?"

Does Lord Carter read AWEB?


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By jon_griffey
24th Mar 2006 17:38

What about Fees Protection Insurance?
A move to a 30 November deadline will inevitably mean more provisional returns being filed. This may well end up being the practitioner's 'fault' because there are simply not enough hours in the day to get all the returns done. This of course may invalidate most fee protection insurance policies. Perhaps Insurers need to be consulted to see if they can give some leeway.

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By User deleted
27th Mar 2006 12:05

Filing dates
Once again a one-sided attempt to sort matters out and streamline everything. It may prove to be a good idea in the long-run but not until the Revenue vastly improves its performance in dealing with post promptly and effectively and produces a contact system that works efficiently and quickly - neither of which seems remotely likely at present

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24th Mar 2006 23:17

Lord Carter's Review
How on earth are practices, particularly small ones like mine, going to be able to meet a 30 November filing deadline? It is hard enough to meet the 31 January one as it is. Has anyone thought this thing through?

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By ACDWebb
27th Mar 2006 14:41

Jonathan, use the Agent Priority numbers

They generally answer within a reasonable amount of time

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By daveforbes
27th Mar 2006 13:45

64-8 not an issue
64-8 will not be an issue, from this September onwards it will be possible for your tax software to submit an electronic 64-8 that should take effect immediately for the purposes of sending in a return.

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