Last week, Accountancy Age reported that the UK’s largest
accountancy firms are about to switch to online filing of SA returns and noted
that e-filing has to date been driven by smaller firms. This begs the question:
why have they only now – ten years after the first SA return was e-filed –
decided to move to electronic filing?
The introduction of a tighter deadline for paper returns in 2008 (31 October
as against 31 January) is obviously a factor. It is difficult if not impossible
to obtain all of the necessary information by 31 October for someone with
partnership, trust or overseas income, or who has very complex affairs. That
makes the extra three months available to those who e-file very attractive.
But there have been specific barriers to e-filing. Returns for taxpayers with
complex affairs need significant supplementary information and the facility to
attach up to 5Mb of such information in PDF format was only added in November
There have also been concerns over HMRC’s ability to handle large volumes of
electronic returns – especially at peak times – and large firms generally have
more authorisation and control issues than smaller firms.
The need to cope with peak volume was stressed by Lord Carter and with much
improved IT infrastructure the SA system worked well this year, with almost
three million returns filed on-line. The second issue was eased to some degree
when it became possible to file a return without a 64-8.
So, if 2008 is likely to see another very significant hike in the number of
e-filed returns, most with substantial PDF files attached, will HMRC’s IT
The key is the Carter Principle: that no new service will be launched unless
it has been fully tested. Because the profession has repeated this like a mantra
for the last year, HMRC’s Carter Project Team have made it a core principle. It
explains why they have put back the implementation dates for the PAYE, VAT and
CT elements of the Carter timetable. The idea that it is better to get one thing
right at a time seems to have been accepted.
That is a major step forward and makes now the right time for the larger
firms to come aboard.
Speaking for a firm that has e-filed for a decade, I think they will find
that once everything is up and running it will turn out to be a good move.
Paul Aplin is deputy chairman of the ICAEW Tax Faculty
and a tax partner with A C Mole & Sons
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