Two of the biggest self assessment pre-population complaints are set to be rectified in HMRC’s phase two roll out next spring.
Improved PAYE and pension data are both chalked on HMRC’s pre-population to-do list.
From 6 April 2019, HMRC’s phase two pre-population release will include:
- Data available earlier in the tax year and maybe for the current year (currently unavailable until September after PAYE reconciliation has completed)
- Pensions data by provider, not aggregated
- Improved data quality (for example, pensions are sometimes reported as employments)
- More data, such as state pensions and bank interest
BTCSoftware’s Rob Ellis said this roll out is what his users have been crying out for. “It's giving exactly what our users want and probably what the whole agent community wants.”
Better PAYE data
Not knowing when the PAYE data is going to be ready has been a tax adviser bugbear. Advisers who prepare tax returns as soon as the gateway opens on 6 April have not had access to this information until the end of May – and even longer for those with P11d.
According to Ellis, this holdup has confused some of his users. They get data for some of their taxpayers and not for other taxpayers. “Our users never really know when the data is going to be ready,” he said.
But in the phase two roll out, the data will be available for everybody – and this includes P11d data. Initially, HMRC will use forecast data to calculate the P11d pre-population data. Before users are able to submit their P11ds, the prompted users will need to “firm up” the data.
The other big complaint is pension data. It currently arrives in one lump sum figure – eg the pre-population would produce a taxpayer’s four private pensions as one figure, explained Ellis. Advisers are often left unsure how much is from which pension.
“Our customers like to see the individual amount so they can show the client what makes up the lump sum figure that goes on the tax return,” said Ellis. But the phrase two SA pre-population roll out will show pensions data by provider, not aggregated.
“That's been missing for the private pension but they've made that change to serve us the pension in the same way they serve us in employment. So if you have multiple employment you get one record per employment. Now we'll get one per private pension.”
HMRC has also improved the data available in the expense breakdown, adding many more categories to the expenses.
Why not sooner?
The soon-to-be released pre-population features will be welcomed by tax accountants at the self assessment coalface but as January’s peak tax return season beckons, many will be asking why can’t these features come sooner?
The short answer is because it’s not ready at the moment. The features are not yet even in testing and are currently residing in a private alpha service. But while there is a modicum of chance the features could be ready in January, and maybe offered as an option, Ellis said releases late in the self assessment year are not normally welcome.
For the obvious deluge of tax return reasons, software providers tend to avoid updates during December and January, unless they’re forced.
About Richard Hattersley
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