Accountants rise to MTD tax challenge with tech
The adoption of Making Tax Digital (MTD) will remain a concern for accountants over the course of the next 18 months. Kevin Sefton considers the challenges, opportunities and education that will arise between now and April 2023.
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Disagree with a lot of content
You will make money from software sales with zero client interaction
4.4 Million new customers are available
MTD is a software explosion in available sales
Having a bank account does not mean having digital records
Look at the Rebecca Cave articles to get a view of what accountants really think of MTD ITSA
Quite right, Paul.
"While there’s an obligation to keep digital records, the reality is that most businesses already do some of this – even if it’s as simple as online banking" ... no idea how you quantify 'most', but I've got clients with > £.75m t/o who only use Word & Excel (no mobile phone or apps, and banking = paper statements.
This article is trying to find mugs to part from their money, not solve anything.
Oh, and why on earth does Kevin think accountants will be interested in "an opportunity to use software to .. support a new audience of potential clients who may pay less on a per-client basis"?
What he appears to envisage is not accountancy - it's the A&E version of book-keeping (triaging & patching things up before the consultant arrives).
Worst of all, he is only interested in the incredibly simple end of development (APPs knocked-up by schoolkids using APIs that work briefly before dying) ... but it all comes to naught when the data enters govt portals and gets transmitted on via not fully tested channels to hit the fractured databases of HMRC et al.
Rubbish article . You don't work with small older self employed so how would you know.
You have no idea about the future and if this will work or not. You just want you subscription in from a captive audience. All my clients have tried and failed on computers using everything from Clear Books to SAGE. Even if constant help from me they have failed and 9/10 times the computer records are ignored. Unless we as Accountants keep the data then most client produce rubbish. If we keep the data then the fees go through the roof. Look at the garbage HMRC spew out - this site is littered with bad reviews of MTD, HMRC and Software Houses. If the IT companies had an sense they would lobby HMRC with the Accountants to delay MTD until a proper stages introduction was organised in a constructive way. Sadly the pound of flesh is more important and the use of HMRC's name as a marketing ploy.
Is an author's knowledge and experience of the real world 'tested' before their article is accepted for publication?
The author says:
"Practices that choose their approach early will be best placed to benefit."
Similar statements were made way back in 2015. I know one practice who put all their clients on QuickBooks Online. They incurred no end of grief trying to teach clients. Since then 90% of their clients have abandoned software, much to the practitioner's relief because of the mess the clients got into and the huge amount of hand-holding needed and unbillable time. Most MTD VAT products didn't appear in the market until about the time MTD VAT was mandated, so those who adopted early found they may have been better waiting until more products were available.
Or maybe I should re-read the author's statement:
"Practices that choose their approach early will be best placed to benefit."
I have chosen my approach: do nothing until nearer the time. That was the approach I adopted in 2015 and it has served me well. It isn't that I'm a technophobe. Far from it, I've been filing 100% digital tax returns since 1998 and have participated in just about every HMRC pilot (still in some now). But I only adopt technology when I can see a benefit to me or my client. I have digitised some client's records when I see a commercial or operational advantage for my client, but most will find the cost (time and and money) of digitisation will be more than the benefit. Thus I believe my policy is the best. And my clients agreed:
Me "We're going to digitise your records"
Client "What's that, and why?"
Me "Coz HMRC say you have to in 2 years and once digitised you'll know where your business stands."
Client "But I already know where my business stands, and because I know what work I've got lined up, I've got a good idea how my business will be in 6 months. Can digitisation do that?"
Me "Er, no. We can use the digital forecasting tools but we're really only digitising the past"
Client "Why? I thought businesses were supposed to plan and look to the future. Why the obsession with the past? What good is that to me?
Me "HMRC want the past digitised, they're not interested in the future."
Client "Is this going to reduce my accountancy bill?"
Me "Yes, if you do the work and are accurate, otherwise I will have to charge extra."
Client "So HMRC are forcing me to digitise stuff which is of no interest to me and you are going to charge me extra for it. No thanks"