TaxCorporate TaxYork accountant claims victory as HMRC exempts charities from iXBRL

York accountant claims victory as HMRC exempts charities from iXBRL

Peter Brown calls HMRC decision to exempt charities from complying with electronic reporting requirements a ‘victory for common sense’ after campaigning for a year

AN ACCOUNTANT from York has revealed how his intervention has saved British charities from a £60m bill.

Former sheriff and Conservative city councillor Peter Brown said legislation passed by the previous Labour government had required all limited companies, including charities, to file tax returns with HMRC using an online filing language known as “iXBRL”, the York Press reported.

Brown said that for non-charities, this had been a relatively simple matter.

However, due to the complexity of charity accounts, no commercial software provider was willing to write the software for charities, and HMRC could not secure funding from the Treasury to develop software on their own website.

“This meant that there was no software solution available to any charity that could enable it to comply with the law,” said Brown, of Peter Brown and Co of Acomb, who specialise in charity accountancy.

“This would have required a bespoke code to be written by every charity every time it filed a tax return.”

He estimated that about 120,000 charities would have been affected, at an estimated average cost to the sector of £500 per charity and about £60 million per annum in total.

He said that for over a year, acting as a council member of the professional body, the Association of Charity Independent Examiners, he had been lobbying HMRC, MPs and the former and present Chancellors of the Exchequer for charities to be exempted from the legislation.

Now HMRC has announced charities will be exempt from the legislation, representing a “victory for common sense”.

Charities will still have to submit tax computations in iXBRL but this will be a simple process, assisted by a facility on HMRC’s web site and with no significant cost to the charity sector.

Related Articles

‘Google tax’ nets HMRC £281m

Corporate Tax ‘Google tax’ nets HMRC £281m

3m Emma Smith, Managing Editor
OTS report: Corporation tax should follow accounts

Corporate Tax OTS report: Corporation tax should follow accounts

5m Alia Shoaib, Reporter
HMRC tax evasion assistance requests double in five years

Corporate Tax HMRC tax evasion assistance requests double in five years

5m Emma Smith, Managing Editor
Spring Budget 2017: Making Tax Digital

Business Regulation Spring Budget 2017: Making Tax Digital

9m Shereen Ali, Deputy Editor
Tax fraud loses HMRC £16bn

Corporate Tax Tax fraud loses HMRC £16bn

10m Emma Smith, Managing Editor
HMRC nets £2.6bn in corporate tax from big businesses

Corporate Tax HMRC nets £2.6bn in corporate tax from big businesses

10m Accountancy Age editorial
Tax crackdown brings in £468m for HMRC

Corporate Tax Tax crackdown brings in £468m for HMRC

11m Accountancy Age editorial
Treasury Select Committee report released on Making Tax Digital

Accounting Standards Treasury Select Committee report released on Making Tax Digital

11m Stephanie Wix, Writer