Save content
Have you found this content useful? Use the button above to save it to your profile.
HMRC system maintenance
iStock_Computer glitch_PeopleImages

HMRC VAT system update goes awry


Two and a half days’ maintenance work on HMRC’s Making Tax Digital (MTD) online service over the weekend spiralled into a four-day block on filing VAT returns.

16th Mar 2021
Save content
Have you found this content useful? Use the button above to save it to your profile.

UPDATE: 15:50, Wed 17 March - HMRC’s  API Platform availability alert service has reported that as of 15:28 this afternoon, the VAT filing incident has been resolved.

A week ago, HMRC informed software developers and alert subscribers that it would be undertaking a number of “iterative enhancements” to its MTD for VAT systems.

While the maintenance was underway, HMRC warned that taxpayers and their agents would not be able to:

  • sign up for the service
  • submit returns
  • view previous submissions and payment details
  • set up new or cancel and amend existing direct debits
  • review and update any business detail
  • access agent services.

Work started at 10am on Saturday morning and was due for completion by 5pm on Monday afternoon (15 March).

By Tuesday morning, however, it became clear that all was not well. Tax Teddy reported on Any Answers that the MTD for VAT service was unavailable and that “lots of people seem to be having a problem this morning... I knew they would break it.”

Service updates confirmed that HMRC was investigating a new incident. Just before 10am, a further message reported that the issue had been identified and that a fix was being implemented.

More downtime

Accountants continued to complain about not being able to access VAT information for another six hours before a more detailed service update arrived. The email explained that HMRC’s programmers would need to shut down the Return Submission element of MTD for VAT to install their fix.

“As a result, it is currently not possible for customers or agents to submit a VAT return through the MTD service,” HMRC warned. Other elements of the VAT service such as sign-up and payment would stay open, however, and there was no interruption to applications for the VAT deferral New Payment Scheme.

“HMRC is working to resolve this issue as soon as possible and expect the full service to return on the morning of Thursday 18th March.”

Four days without filing

The HMRC MTD team should be thanked for scheduling the initial 55-hour update after the monthly filing deadline on the 7th. But the amount of time set aside for the tasks suggests that they were undertaking more than just “maintenance” work.

There’s always a risk that software projects can go wrong, but having to take the VAT filing mechanisms out of action for four days raises questions about the system’s robustness and back-up capability. Tax agents have had a rocky ride with authorisations and agent services accounts ever since MTD for VAT became mandatory in 2019.

The core processing systems have been relatively stable until now, with just 10 unscheduled incidents in the past 14 months. As work starts ramping up for the next wave of VAT filers and another 3-4m income tax payers in 2023, it’s not very reassuring to see the MTD systems falling over so spectacularly.

Replies (12)

Please login or register to join the discussion.

By Paul Crowley
16th Mar 2021 19:59

So glad it was not PAYE and CJRS

Thanks (0)
By DaveyJonesLocker
16th Mar 2021 22:22

I just don't see how HMRC have the technical ability to cope with MTD for tax which will involve many more records than the VAT version.

Thanks (2)
Replying to DaveyJonesLocker:
By AdShawBPR
17th Mar 2021 09:41

This is made even worse by Xero's MTD for VAT process. You cannot open a MTD VAT Return in Xero if HMRC's system is down. That's right I can't even work on the VAT Return let alone file it because you can't pull up the report unless you have the connection. I and many others have highlighted this flaw over the last 2 years but Xero have ignored it. Perhaps now Xero will appreciate the problem and will look at it again.

Thanks (4)
Replying to AdShawBPR:
By chs
17th Mar 2021 10:04

In agreement with you there Adam. It has been a frustration for agents not to be able to view a full vat return - unless you happen to be the MTD authorised person. Even the workaround for other users does not show late items. Now with MTD part of the service down - it breaks the whole vat return process in Xero.

Thanks (2)
Replying to chs:
By littlerich
17th Mar 2021 10:38

Oh how much frustration Xero have caused over this. Sick of having to constantly tell clients what their VAT is during a quarter when they should be able to just go in and see.
God knows what they will do with MTD for ITSA!

Thanks (2)
17th Mar 2021 11:04

The problem didn't start on Tuesday morning, that was just when many noticed it.

The problem started within the first hour of the end of the maintenance period. It worked for a very short while, after the maintenance period ended, but within an hour it had been shut down again and stayed like that all night (I kept checking periodically) and into Tuesday.

One of the problems with HMRCs API error notification service, is that it is often many hours behind when a problem arises. I think the people that run that service went to bed and didn't check their emails until the next day.

Thanks (1)
By sammerchant
17th Mar 2021 12:54

HMRC & IT - Oil and water!!

Thanks (0)
By DaveyJonesLocker
17th Mar 2021 13:31

Another update, now down until Thursday morning!

Thanks (1)
By SteveHa
17th Mar 2021 14:38

There’s always a risk that software projects can go wrong, but having to take the VAT filing mechanisms out of action for five days....................

Surely that should read, "There’s always a risk that software projects can go wrong when HMRC have anything to do with it"

Thanks (0)
John Stokdyk, AccountingWEB head of insight
By John Stokdyk
17th Mar 2021 16:01

We've been getting a lot of traffic on this item all day (Wednesday), so perhaps HMRC's programmers had some extra motivation to patch the MTD for VAT filing mechanism up asap.

I've just updated the article with news that came through from the API email alert at 15:28 that the problem had been rectified.

I'll be asking for a background briefing on what went wrong, and more interestingly, what new features they were adding to the system over the weekend. But give the emergency response team for fixing it ahead of Thursday morning. Now let's see if it holds...

Thanks (0)
By daveah
17th Mar 2021 16:03

According to the receipt, managed to file a VAT return about an hour ago.

Thanks (0)
By habenani
18th Mar 2021 01:19

Is this a new one? The IT team or vendor handling the updates have some serious question to answer. I reported this on 08 March where it was down for two days and people complaining all over. Managed to take a screenshot where the IT team seems to have pushed the changes to live system without testing it.

All the links on the system were pointing to a local system rather than an actual server address.

Being in IT, I can say this was a cowboy mistake.

Thanks (1)