ICAEW correspondence highlights the many unknowns of MTD

23 May 2017

The Institute of Chartered Accountants (England and Wales) has sent HMRC a lengthy list of questions about the practicalities of the MTD project which have not so far been addressed in HMRC collateral. The full list can be viewed here, and copied below is the section on the pilot and software, which we imagine might make the recipient squirm in their seat somewhat:

Pilot and software

  1. How is the pilot progressing?
    a. How many agents are registered? Fewer than 10?
    b. How many businesses are registered? Fewer than 100?
  2. When can we expect to learn more about the API (application programming interface) release timetable – software companies are not now expecting the API for quarterly updates until after the election?
  3. What is the latest position on the provision of free software – the 60% free software assumption in HMRC’s impact assessment appears to be very high?
  4. What is the latest position on spreadsheets – some of the software companies have indicated that they are developing a product to link data from spreadsheets to their accounting software products – do we know how many are planning to do so?
  5. Given delays to the pilot and legislation will the implementation timetable be altered?
  6. How does HMRC intend to identify and communicate with the estimated 400,000 businesses who are expected to be mandated from April 2018?

Good news then – the software industry is pumping huge resources into developing solutions which it will simply give away for free, and professionals won’t be charging for their time in advising and assisting taxpayers to meet their obligations. Clearly you’ve been worried about nothing.

Alternatively, if you haven’t drunk an Alice in Wonderland potion and are living outside the Treasury office impact assessment team, in the real world where things take time and cost money, it’ll be interesting to hear HMRC’s response to this document (once they get out of purdah presumably) but they’ll need taking with a pinch of salt.

In the mean time we have to assume the current timetable perseveres, and prepare ourselves accordingly.

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