IRIS discontinues OpenTax

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IRIS is retiring the cloud tax platform OpenTax and transferring users across to its desktop alternative, Keytime.

News about the future of OpenTax started circulating last month as AccountingWEB members took to Any Answers to find out whether IRIS was pulling the cloud platform completely or just delaying the 2016/17 tax returns.

Answering these questions, Sion Lewis, chief executive officer of IRIS’s accountancy division, confirmed to AccountingWEB that IRIS will be withdrawing OpenTax from April 2018 and will instead offer those customers Keytime or the IRIS Accountancy Suite for larger firms. 

At the start of the April word spread on Any Answers that IRIS was delaying 2016/17 tax returns until late May. One AccountingWEB member complained that the delay could cost them money and clients. In response, Lewis assured customers that although the SA100 personal tax update won’t be available until the end of May, OpenTax will remain compliant for another year.

Users want enhanced experience

Lewis made the decision about OpenTax after speaking with IRIS users when he joined the business last September. “We surveyed over 1,000 of our OpenTax customers and unfortunately, the response was that they needed better client management, better reporting, better and more efficient data entry - they wanted an enhanced user experience,” he said.

“The thing about Keytime and IRIS Accountancy Suite is that it is a better user experience, better functionality, it's incredibly sophisticated, and I thought I'd give them what they wanted.”

The feedback from these discussions convinced Lewis to move OpenTax customers to Keytime at a “commercially parallel” price. When Lewis spoke with AccountingWEB last week Keytime had 250 users with another 500 in conversations to adopt the desktop software.

The switch was not motivated by one being cloud and the other being desktop, but more a response to “what the customer wanted”, Lewis said.

“The guys living and breathing tax returns every day, they are office-based. They wanted to do it more efficiently and quicker and Keytime or IRIS will allow them to do that. “By talking to the customer you find out what you need to do with your product and they actually wanted a more sophisticated product than the cloud tax product could provide,” Lewis said.

“If you're looking to efficiently use a tax product you need to be on the desktop.”

Cloud-based alternatives

While Lewis sees the future of tax return compliance in a “rich desktop environment”, some IRIS customers turned to Any Answers looking for alternative software hosted in the cloud.

AccountingWEB member dantray said: “[Desktop-based Keytime] poses problems for me as my staff work remotely and a lot of my sole trade clients are CIS rebates, and definitely not going to wait until June for me to file their returns.”

Meanwhile, AccountingWEB contributor Richard Sergeant spoke with OpenTax customers at the recent Thomson Reuters Synergy conference and Sage Summit and found they were keen to evaluate their options.

“They were clearly committing time to reviewing their options on the basis that they were unhappy about the OpenTax discontinuation,” Sergeant said. 

About Richard Hattersley

Richard Hattersley

Richard is AccountingWEB's Practice Editor. If you have any comments or suggestions for us get in touch.

Replies

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By Tornado
04th May 2017 11:33

The question is, therefore ... Is the future in the Cloud or the Desktop?

Not mentioned is that although the 2017 SA100 will be late, IRIS has no intention of creating 2107 Partnership or Trust Returns ... ever.

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to Tornado
04th May 2017 13:30

To be fair 2107 is a little way off, MTD might be live by then!! On a more serious note this highlights the downside of cloud solutions. They can and will disappear as the market matures and that's a real risk. I presume IRIS are enabling clients to extract all their client data in a useful format prior to closing down?

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By Tornado
to Neophyte
04th May 2017 13:35

"On a more serious note this highlights the downside of cloud solutions. They can and will disappear as the market matures and that's a real risk"

Could you explain why you think this will happen.

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to Tornado
04th May 2017 18:21

My perception is that the market is not big enough for all the current incumbents. Some will fail. Some will merge. Some will dominate. If you have all your client data in a system that you don't control, then that's a real risk and it requires mitigation. For a tax product which is not client facing and computationally intensive the cloud is a less compelling platform than for a simple bookkeeping service or a client portal.

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04th May 2017 13:41

I trialed OpenTax in the early days. I decided to stay with our existing desktop software: PTP. There were two reasons why I preferred the desktop software. Firstly it was much faster than the cloud: quicker input and navigation. Secondly the presentation of the desktop software was more efficient than cloud. Iris improved the speed but I felt it was still slower than desktop. I have found these problems with just about all cloud software that I've used. This is also one of the reasons why I object to MTD with its emphasis on cloud software: cloud software is slow especially for bulk data input and us agents are going to be pulling our hair out.

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to kevinringer
04th May 2017 13:59

I think it's the cloud software providers who are emphasising cloud software in the context of MTD. MTD only requires use of digital methods, which, of course, includes desktop software.

And, watch this space - we're going to see a lot of software designed for tax and accounts compliance in accountancy practices get "retired" over the next few years. Why? Because MTD, simplification and deregulation mean its not going to be required.

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to Adrian Pearson
04th May 2017 14:24

"simplification and deregulation mean its not going to be required."

You do what? There has been a MASSIVE increase in regulation and a MASSIVE increase in complexity in the past 5 years. RTI, pensions, now MTD. Tax is horribly complex and changes so often its very hard to get it right.

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to ireallyshouldknowthisbut
08th May 2017 09:48

Professional practice software (from the likes of IRIS / Digita / Sage etc) is mainly used for reporting - printing and filing accounts and tax returns.

Sole traders are not currently mandated by law to produce a set of accounts (in formal printed form as facilitated by the software I am referring to). The vast majority of companies (as they qualify for the Micro Entities regime) can now produce very simple 2-page accounts documents, again no need for powerful reporting software.

That leaves tax returns. MTD will sweep away the requirement to produce a printed, or any other type of, tax return for sole traders and, eventually, companies.

Practice management software will probably become essential. Accounts and Tax Return production software I argue will become redundant.

So I stand by my original assertion.

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By chatman
to kevinringer
04th May 2017 16:01

kevinringer wrote:

I trialed OpenTax in the early days. I decided to stay with our existing desktop software: PTP. There were two reasons why I preferred the desktop software. Firstly it was much faster than the cloud...

I haven't noticed the cloud per se being slow, but Iris Open Tax was very slow.

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By mabzden
04th May 2017 14:54

For years we've been told that the big software providers are beavering away on their cloud offerings and we should expect some exciting announcements around the time of Accountex. This year's exciting announcement is that Iris is ditching the cloud and going back to its core 10 or 20-year old desktop software.

Some great quotes in the article.

“We surveyed over 1,000 of our OpenTax customers and unfortunately, the response was that they needed better client management, better reporting, better and more efficient data entry"

So it sounds as if OpenTax was [***] then??

“If you're looking to efficiently use a tax product you need to be on the desktop.”

Is that always true, or just if you're using an Iris cloud-based product? I suspect it's the latter...

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By Tornado
to mabzden
04th May 2017 16:03

I have to say that I use OpenTax and no one surveyed me. If they had I would have said that I liked many aspects of the product and up until the 2016 Returns, the system did just about everything that I wanted it to, albeit a bit slow.

The Tax Computations became impressively detailed over time and the product seemed to be developing well.

The problems first appeared with the 2016 Returns where basic errors started appearing and taking months to fix. There was clearly a problem somewhere and I wonder if IRIS were so obsessed with developing MTD software and the riches it would bring, that they neglected to allocate proper resources to their current products.

Personally I think IRIS are currently trying to dig themselves out of a hole as they have charged me for 2017 Partnership and Trust Tax Returns but only told me afterwards that they will not be providing the necessary software. Clearly they did not know this when they charged me which does suggest that the demise of OpenTax is just as much a surprise to them as it was to me.

There seems to be something not quite right with IRIS at the moment and perhaps the sudden favour of Desktop based programs is just a way of trying to convince us that this was going to be the plan anyway.

MTD has a lot to answer for and the ideas are way ahead of reality. I hope the introduction of MTD is significantly delayed so that companies like IRIS have the time to develop programs that work properly and really are fit for purpose.

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04th May 2017 19:49

I think we'll be seeing a lot more of this sort of thing with cloud software, especially if MTD gets booted into the long grass after the Election.

Clearly Sage and Intuit are well-capitalised firms who have not bet the ranch on MTD, and will still be around in 5 years time. I can't think of another cloud software company that statement applies to, though.

This sector could well be a classic zero to hero and back to zero setup for many players I am afraid.

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to mr. mischief
04th May 2017 21:44

That makes absolutely no sense. I think you've completely misunderstood either what MTD is or what cloud software is. MTD has nothing to do with cloud software. Most cloud software does not even support MTD, and I, like many others, was using cloud tax software long before MTD was even thunk of.

Far from MTD being the driver for cloud software, it is the advent of the cloud and its inevitable rise to domination that has caused HMRC to knee jerk into their MTD obsession. And it is desktop software that is pushing the MTD line (TaxCalc being one of the keenest evangelists) because they see it as being a way back in to the cloud world they are being excluded from.

The failure of IRIS OpenTax is purely down to the fact that there are now much better, cheaper and faster cloud alternatives out there that OpenTax just cannot compete against. IRIS have just completely underestimated the requirements of the cloud market, and it's a case of too little, too late. The anecodatal evidence suggests that OpenTax users have been leaving in their droves to other cloud providers, and the failure of IRIS to even produce a product this year has forced them to try and retain those users by pulling them back onto desktop before they join the exodus.

Far from being "zero to hero", the other cloud providers must have been rubbing their hands in glee at the thousands of new users that IRIS have sent their way in the last year or two.

I am sorry, but anybody that thinks desktop is the future of tax software (or any software) is deluded. All the money is going into cloud - nobody is actually putting money into desktop software development except to keep the legacy alive long enough to survive the move.

As for IRIS, they'll do what they always do: they'll just buy one of the successful cloud products and all will be well. Only then will they kill off all their desktop products. RIP desktop.

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By chatman
04th May 2017 21:56

Tim Vane wrote:
I am sorry, but anybody that thinks desktop is the future of tax software (or any software) is deluded.

I may be way off the mark here, but you don't sound very sorry.
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04th May 2017 23:26

I just hope iris don't buy taxfiler

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By Tornado
to Kim Jong Un's Hair
04th May 2017 23:38

One clear problem with IRIS is that their software has not been developed as an integrated suite and the various elements do not quite work well together.

I was always confused as why I bought licences from PTP but everything was IRIS branded. The Company seems to have an identity problem!

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05th May 2017 06:57

My main problem with all of the cloud software products I have used is that they are all a bit pants. See numerous posts of mine on this subject for details.

Whilst initially the business owner users may not realise this, over time they will start to realise the implications in my view.

The point I am making is that many of the Cloud players have woefully weak balance sheets compared to what is needed to deliver decent product that is more than just a load of fancy graphs and can actually do the business without taking ages for each page to load.

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05th May 2017 14:54

unfortunately it is the nature of tax and its ever changing and increasing complexity. Having used IRIS/taxfiler/Digita/CCH and a few others I have yet to find one that is truly integrated or without significant flaws that require some work around, and most that inevitabley cannot cope with the 10% of 'awkward' cases.

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