MTD for VAT: Destination digital

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Looking ahead to a year that is shaping up to be one of major legislative change and business uncertainty, Sage director of product management Chris Downing is returning to the Accounting Excellence airwaves to help equip practitioners for the challenge ahead.

A champion returns

Before joining Sage in June, Downing was a business intelligence partner with Milsted Langdon, a multiple award-winner in previous years. In that role, Downing has talked with AccountingWEB many times and appeared in a live conference session where he explained how he built up a department in the practice based on working with clients to identify and report on their key performance indicators.

Based on those experiences, Downing developed a broader philosophy around advisory work.  “People come to you with a management information issue and ask, ‘I have this problem and need to do this report.’ You never know where it’s going to go,” he said.

“Often you need to dig into the accounts to source and reconcile the data to get the answer and then learn what’s important to the business. You need to become a problem solver and devise new strategies and services to support their continuing success.”

The challenges of MTD for VAT

Making Tax Digital for VAT is a reporting requirement that every VAT-registered business above the £85,000 threshold is going to need to satisfy from April next year.

“You need to be ready for MTD when it hits,” Downing has been advising practitioners. “The biggest issue we have to confront is the MTD transition for our clients. They’re still not aware of what it will be.”

In the absence of concerted education and advice from HMRC, accountants and their suppliers are filling that vacuum. “Now we have more detail in the MTD for VAT Notice, we have a better understanding of what our messages to clients will be,” he said. “We have to approach them with the right knowledge and start onboarding them with systems that will be right for their businesses.”

MTD will happen, Downing continued: “The underlying challenge is getting clients to deliver accurate information on a systematic basis every quarter. How will you get hold of it and deal with adjustments, accruals and so on? It’s going to be an exciting time, but it will be a struggle for some accountants as they are already busy.”

The 16 August webcast is designed to help accountants overcome that hurdle with practical advice on defining different client groups and planning communications and service delivery options to step them towards MTD for VAT readiness.

As well as sharing his personal insights, Downing will discuss the issues with a fellow Accounting Excellence practitioner, webinar host John Stokdyk and the live audience.

Accounting Excellence Talks sponsored by Sage

Digital transformation and how to get there

The message Downing is particularly keen to leave behind is that MTD for VAT next April shouldn’t be the sole focus. Rather than viewing MTD for VAT solely as a client management challenge, he’s keen for practitioners to see it as an opportunity to overhaul their own processes as part of a wider digital transformation: “Use the tools and techniques yourself, see how they work and what they can do for your business. If you can make your practice more efficient, you learn how you can apply those new skills to client businesses.

“There are so many new opportunities: for example, to get clients off of manual records and spreadsheets and into systems that will make them more efficient.

“Technology applications are changing all the time and becoming more accessible. The things that used to take accountants ages to do - like extracting data from Sage 50 to produce management accounts - are now done for you in software, so you can spend more time understanding and interpreting the underlying issues. The opportunity for practitioners is to embrace these systems to win back time that they can invest in performing more valuable work for more clients.”

Click here to join the live broadcast on 16 August at 11am with Chris Downing

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About John Stokdyk

John Stokdyk, AccountingWEB head of insight

AccountingWEB’s Head of Insight has been with the site since 1999 and likes to spend his time studying accountants’ technology habits. When not nerding out, you can find him exploring obscure indie music and searching for the perfect organic sourdough loaf from his base in Brighton, UK.

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