In most conversations about Making Tax Digital for Business, the word ‘spreadsheets’ is bound to crop up at some point or other. As in how will/can/do they fit into HMRC’s plans for the not too distant future?
So it was interesting when I clicked on the PWC link in the UK tax authority’s latest 18-strong list of suppliers of software for MTD VAT . It would seem that quite a bit has been going on behind the scenes, and progress is being made. And the word ‘spreadsheets’ appeared several times!
The Big Four group says: “To meet the 2019 obligation HMRC will require you to keep VAT records using ‘functional compatible software’, meaning one or several software programs which can connect to HMRC’s systems using an approved application programming interface (API) such as our PwC VAT eFile spreadsheet solution or our more sophisticated software solution which meet the most complex of VAT accounting and compliance needs in addition to the API filing requirement.
This functional compatible software must be able to:
- Make and keep records in a digital form;
- Preserve records in a digital form for up to six years;
- Create a VAT return from the digital records and provide HMRC with that information digitally; and
- Receive information from HMRC via its API platform.
As well as software, PWC is offering businesses a “digital readiness review”. PWC will check:
- The quality of your VAT data and compliance related VAT processes, when compared to the MTD requirements and standards of your peer group;
- Where data or documentation needs to be moved into a digital format or software in order to be MTD compliant;
- Where the data and software need to be digitally linked in order to be MTD compliant; and,
- How MTD compliance can be achieved, the options available to you, and the advantages and disadvantages of each.
“The outcome of this review will be a report which clearly highlights where the new requirements are currently being met and any areas which require further work, process or software changes to become compliant.”
The company is also providing this service: “a forensic Excel review to ensure that your spreadsheets meet with HMRC’s current MTD guidelines, analysing and recommending fixes ahead of any potential HMRC MTD spreadsheet review.”
The group says:
“As part of HMRC’s Making Tax Digital (MTD) initiative the UK tax authority has looked at the use of spreadsheets within the VAT compliance process. Whilst recognising their widespread use, HMRC have identified weaknesses and risks in the way in which spreadsheet data is often compiled and manipulated. As such, UK businesses have an obligation to ensure that their spreadsheets meet MTD requirements and adhere to best practice.”
- We can ensure that your spreadsheets meet with HMRC’s current MTD guidelines, analysing and recommending fixes ahead of any potential HMRC MTD spreadsheet review;
- For high-risk spreadsheets we can carry out integrity checks using our automate spreadsheet auditing tool;
- Provide a summary of risks, issues and potential impacts of reportable tax figures; and
- Advise on how these ought to be addressed.