PracticeAccounting FirmsHMRC deadline fears for software firms

HMRC deadline fears for software firms

Only three out of twenty software companies currently produce packages capable of producing iXBRL accounts, HMRC claims

Will you be able to file your clients’ tax returns next year? It might seem
an odd question but it is an issue that has come to the fore as the deadline for
HMRC’s new filing rules draws closer, and software vendors are yet to produce
all the technology needed to meet the taxman’s requirements.

HMRC corporation tax filings after 1 April 2011 need to be submitted online
using iXBRL (in-line eXtensible Business Reporting Language), a computer tagging
format which allows easier comparability of financial information.

This month HMRC released a shortlist of software vendors which can produce
various iXBRL technologies. Out of 20 companies listed, only three were able to
compile company accounts in iXBRL, although most can submit basic tax returns.

Among those unable to supply iXBRL accounts are Sage, Thomson Reuters (the
owners of tax software suppliers Digita), TaxCalc and CCH – with the list
updated whenever a supplier is added.

The technology companies claim all software will be available by November
2010, but experts in the profession believe this could be too late.

Derek Allen, tax director at ICAS, warned there is a level of unpreparedness
among accountants and businesses which have not been given a chance to use the
software.

Some software suppliers said HMRC had failed to finalise its tagging
requirements. However Paul Booth, technical and development manager at the ICAEW
IT Faculty, believes the vendors’ development could have con­tinued without a
finalised list. Booth added that most IT projects overrun, and preparers of
accounts need to “play” with the software before its use becomes mandatory.

PwC’s XBRL assurance leader Jon Rowden said suppliers would soon “need to get
their act together” in order to allow implementation time for customers.
At the time of going to press there were no further updates from HMRC and it was
unavailable for comment.

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