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Post Info TOPIC: MTD bridging


Master Book-keeper

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MTD bridging


All from Sage.

Perpetuating the myth that bridging software is ONLY available to be used during the soft landing period.

Challenged that.

Response 'well some software you cannot use'.

Anyone have any access to where it states in law/other HMRC 'stuff' that this is complete balderdash? (not being lazy, am at a clients, not got access to all my links of info and on the phone to them now!)



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Joanne

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position (and my that I dont mean with HMRC)



Expert

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Hmm... in 2012, I reported Sage to the ASA about a claim on their website promoting Sage 50 2013. (Checks details...)

A bullet point on their website said:

* Submit your VAT returns to HMRC directly from Sage 50 Accounts (now a legal requirement)

That wording makes it sound like it had become a legal requirement to do so using Sage, and as such was a false claim.

My complaint was made on 2nd August, and I probably CC'd it to Sage themselves. On 10th, I received a reply from ASA to say Sage had revised the wording without being prompted to:

* Submit your VAT returns to directly to HMRC online (now a legal requirement for most businesses)

TBH, I thought at the time it was probably just badly worded, but made the complaint because this was around the time I was having issues with Sage not honouring my email preferences. However, here we are all those years later and you're saying they've made an iffy claim about MTD submissions.

But to answer your question, from: https://www.gov.uk/government/consultations/making-tax-digital-reforms-affecting-businesses/making-tax-digital-for-vat-legislation-overview (but note: overview, not the actual rules).

"Third-party software

The regulations will provide that a business is in scope for MTD must use functional compatible software to meet the new requirements.

Functional compatible software means a software program or set of compatible software programs which can connect to HMRC systems via an Application Programming Interface (API). The functions of the compatible software must include:

keeping records in a digital form as required by the regulations
preserving digital records in a digital form as required by the regulations
creating a VAT return from the digital records held in functional compatible software and providing HMRC with this information digitally
providing HMRC with VAT data on a voluntary basis
receiving information from HMRC via the API platform in relation to a relevant entitys compliance with obligations under the regulations"

The key part of that, to my reading, is "a set of compatible software programs" - at the end of the day, only one piece of software needs to be MTD compatible; the piece of software that submits VAT returns, so the mention of a set of programs, to me, suggests they accepted from the outset that a bridging solution might be appropriate.

That said, given that this is the overview, there's also this:

"Supplementary data

HMRC believes that businesses and HMRC could benefit from the submission of supplementary data. While the simplicity of the 9 Box VAT return has advantages for businesses in terms of reduced administrative burdens, because HMRC receives no information about how the figures in the return are arrived at, it is difficult for HMRC to target its downstream compliance activity at customers most likely to be non-compliant.

HMRC will permit, and functional compatible software will provide for, the voluntary submission of supplementary VAT data as part of a VAT return or a voluntary update.

The legislation will describe the information that would be required but, broadly, this will be summary totals of the information required to be kept and preserved electronically as detailed in Annex 1.

This will allow HMRC to test with businesses the extent to which they and HMRC can benefit from such supplementary data."

That would only work from the original record keeping software itself, rather than a bridging solution of the simplest form (export from the original software, import into the bridging software for submission). Bridging software could still be a solution in that scenario, but it would have to interface more directly and seamlessly with the main software.

So even if the person at Sage was thinking of the supplementary data possibility, it still isn't absolute that bridging software couldn't be used - and that's assuming this is ever put in place in the first place.



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Vince M Hudd - Soft Rock Software

(I only came here looking for fellow apiarists...)



Master Book-keeper

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Hi Joanne

Theresa Middleton expelled that myth in a seminar I went to at Accountex. Having a quick skootle about I can't see anything specific from HMRC but my take on it is that Bridging Software will be here at least until transactional data is submitted along with the VAT return.



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John

Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.



Senior Member

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There was something specific in the June developers briefing.

There are bridging systems that are not really operating properly (ie allowing people to type directly into the VAT boxes on a web page as part of the bridging process as opposed to summary figures being typed into an accounting system). Those will get stopped by April 1st 2020.

If you want me to try to get together the precise words on this I can, but it will take a little time. If you are happy just telling Sage to look at the June developers briefing that should do.

Incidentally I was asked to copy into AW some of the July Briefing. That might be useful here so this is what I posted:

Quoting from extracts:
Customers who havent yet signed up should now not do so until their 7 August 2019 return has been submitted and payment taken.

These customers will fall under the soft landing so will not be subject to any penalties, however, we will shortly be sending them a nudge letter to encourage them to join ahead of their next submission date.

Currently, around 10,000 businesses are registering for MTD every day, with our busiest day so far seeing a total of 19,500 sign-ups. Over 700,000 businesses have signed up in total, and over 480,000 successful submissions have been made through software.

VAT registration certificates now available

We can also confirm that the vast majority of customers (or agents on their behalf) that have signed up to MTD are now able to view their VAT Certificate in their Business Tax Account (HMRC online services).

The functionality for agents to access this information will be delivered in August 2019, in the meantime they should call the VAT helpline to request the information.

For a small number of customers with non-standard accounting periods, the functionality will be delivered later this year with a confirmed date to follow.

The domestic reverse charge comes into effect on 1 October 2019 and is a major change to the way VAT is collected in the building and construction industry;

We have seen instances where duplicate submissions are received within a very short period of time (seconds). Whilst our back end systems are designed to reject duplicates, the timescales dont allow us to time to process and close the first submission before the second is sent, causing a duplicate return.

Planned for August 2019:
Non-mandated customers can leave MTD.
A submission service to enable customers who are not mandated and have left MTD to submit their VAT returns through MTD.

4. HMRC helpline tell customers to speak with their software provider when the fault is at HMRCs end e.g. the numeric period key problems.

5. Why have HMRC decided that historic VAT data i.e. pre-MTD will be availablenow via the MTD APIs, despite developers being told all along that the only
data available would be that from MTD onwards? The majority of users will notbe able to see any historical data from prior to their joining MTD. However, a numberof customers with open transactions (disputes, unfiled returns, outstandingbalances, etc.) may still be able to see some limited historical information such asobligations and balance brought forward. To see their historical data they wouldneed to view this information from their Business Tax Account.

7. What is the purpose of the receipt ID and what other reference information can we provide to the customer to help them in their query with HMRC (call handlers do not seem to recognise the reference)? The receipt ID is a proof of receipt and should only be used in disputes to identify the actual information sent to HMRC (non-repudiation). The VAT Registration Number and Form Bundle Reference should be quoted in all other enquiries.



-- Edited by johnhemming on Thursday 1st of August 2019 01:34:49 PM

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Master Book-keeper

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Will take a look at this later when Im back home.

Thanks for your replies so far.

Im going to be more ready for them next time they call!!


__________________

Joanne

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position (and my that I dont mean with HMRC)



Master Book-keeper

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johnhemming wrote:


If you want me to try to get together the precise words on this I can, but it will take a little time.


-- Edited by johnhemming on Thursday 1st of August 2019 01:34:49 PM


Thanks for the offer John, but absolutely no need.

Im gathering info and will what rubbish they spout next time. I may well do an email back to them. Think they thought they were just dealing with an in house office bod here at my clients who they could twist round their little finger, rather than an Accountant who actually chats to others about such things!

Ive had another sales bod on from Payzone, spouting some rubbish about Worldpay!

Plus someone from Google about the fact that we need to pay for google maps, who after my probing couldnt get off the phone fast enough and said she would email me -strangely, nothing so far!



__________________

Joanne

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position (and my that I dont mean with HMRC)



Master Book-keeper

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Posts: 8295
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A proper thank you after now having read each of your posts in full.

Vince - the issue with Sage's claims are they were made verbally, although there was a mention of this call 'could' be recorded for training purposes. I might try requesting a copy.

John R - did you record Ms Middleton?wink

John H - I saw the article on Aweb, although I had 'parked' it, with a few other MTD related ones for a catch up reading session over the weekend.

Thanks again - I will be armed next time they ring, assuming they ring when they say they would.

Its been a strange old day with all the sales calls, plus a stray very much malnourished kitten wandered in which looks like its now been adopted by the company as the boss went and bought cat food and fed it. Then there is the flooding chaos. Boss man's house has been hit, but the worry now is the possibility of the dam breaking in Whaley Bridge, which is not far up the road.https://www.bbc.co.uk/news/live/uk-england-derbyshire-49196445

Stay safe people whereever you are!



__________________

Joanne

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position (and my that I dont mean with HMRC)



Master Book-keeper

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Posts: 3273
Date:

Cheshire wrote:

John R - did you record Ms Middleton?wink

Unfortunately not!

Its been a strange old day with all the sales calls, plus a stray very much malnourished kitten wandered in which looks like its now been adopted by the company as the boss went and bought cat food and fed it. Then there is the flooding chaos. Boss man's house has been hit, but the worry now is the possibility of the dam breaking in Whaley Bridge, which is not far up the road.https://www.bbc.co.uk/news/live/uk-england-derbyshire-49196445

Stay safe people whereever you are!


Yes, I was thinking of you today when I heard of the flooding in Cheshire and Greater Manchester.

Hopefully that dam doesn't break, that'll be catastrophic for Whaley Bridge



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John

Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.



Senior Member

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Sadly our office cat known as Fred Astaire (because he was polydactylic) passed on recently. He had been the office cat for over a decade.

There is a picture of the office (Osmond House) which used to be a childrens home here: (half way down the page)
www.childrenshomes.org.uk/BirminghamDB/



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