Taxfiler launches smooth integrations
As bookkeepers and accountants brace themselves for another busy tax season, Taxfiler is launching integrations for KashFlow and Xero online accounting software to streamline the submission process.
The new integrations enable accountants to efficiently move information into one system, enabling submissions (tax returns, accounts and VAT returns) to be completed from a single compliance solution. Efficiency has never been so important in the industry, as professionals prepare for the changes required within the new Making Tax Digital (MTD) for VAT regime coming into force in April 2019.
James Reeves, director of Taxfiler says: “Digital record management and sharing is absolutely key for MTD. Every efficiency gain made helps drive productivity and streamlines the process for accountancy professionals. The new integrations are another step to ensuring core compliance can be done correctly, and help firms succeed on the MTD journey.”
Monthly subscription service
Taxfiler has rapidly established itself as a cloud-based monthly subscription service for agents and accountants to submit statutory accounts and tax returns for companies, partnerships, individuals and trusts.
Alongside QuickBooksOnline, trial balances from KashFlow and Xero are imported into Taxfiler Accounts Production. This is done by opening a client, selecting the Trial balance screen, choosing the relevant cloud bookkeeping option and entering user credentials.
Taxfiler says it will be announcing further integrations in the near future.
Ireland upgrades PAYE system
PAYE Modernisation or Real Time Reporting is the latest big policy overhaul in Ireland.
It's also known as SMART PAYE and this is probably to facilitate then following snappy little memory jogger by the Revenue’s marketing department.
- Seamless integration into payroll.
- Minimize employer cost to comply.
- Abolition of P30s, P45s, P60s and end of year returns.
- Right tax paid on current due dates.
- Time savings.
The benefits of PAYE Modernisation are:
- Real time info to the Revenue so employees and employers will have the most accurate and up to date information relating to pay and tax deductions.
- It will improve streamlining of current business processes.
- It will put an end to under/overpayment of tax.
- Reduce administrative burdens experience at end of year when employers have to meet PAYE deadlines.
(RIIR PAYE doesn’t quite have the same ring to it but at least you are more informed now!
But what's the bigger picture? Will all this change really have any effect in the long run besides a smoother PAYE process?
In order to answer this question let’s take a look at PMod’s predecessor Real Time Information (RTI), that was rolled out in the UK back in 2013. Did it do what it set out to do? How is RTI performing now?
Well the answer to the first question is absolutely!
The changes were all positive and HMRC and are able to deal with PAYE payments and debt more effectively, improving the flow of PAYE payments to the Exchequer, and has had a 99% integration rate. The programme’s Final Business Case reported that the introduction of RTI had enabled:
- Savings of £64m for HMRC
- Savings of £672m from reduced tax credits overpayments due to fraud, error and in year income discrepancy
- A one-off cash flow benefit to the Exchequer measured at £813m
- A net saving administrative burden for employees od £292m per annum.
- Data sharing with other governments departments has seen savings of £491m from correction of claims to DWP benefits other than Universal Credit (UC).
And how is RTI doing 5 years later? Well, according to the same post-implementation report the continuing benefits of RTI are as follows:
- There is a direct benefit for key government areas such as pensions, auto enrolment and student loans.
- Enabling tax and benefit systems to become more responsive. Tax codes are more accurate as are annual estimates of pay.
- Once UC is fully implemented RTI is expected to result in savings of £600m from prevented erroneous and fraudulent UC claims.
So there you have it, some cold hard facts and figures. If the UK is anything to go by, PMod is going to be hugely beneficial to Ireland.
We can't predict all areas that it is going to help with but we can safely say that, as a country, they will be better off.
PAYE Modernisation with Payroll Software
Revenue has strongly advised employers to review their payroll processes and systems to ensure they meet the new PAYE Modernisation requirements for January 2019. Payroll software which caters for PAYE Modernisation will improve and simplify communications between employers and Revenue.
If you have the correct payroll software tools in place, the ongoing reporting to Revenue will be seamless, ultimately saving time and reducing the risk of errors each pay period. Employers using payroll software that is Revenue compliant will be able to create and send the periodic PSR submission directly to Revenue from the payroll software at the click of a button. This integration with Revenue will also allow employers to automatically retrieve RPNs for employees from within the payroll software. Changes to an employees tax credits and cut-offs can then be updated in the payroll software with just one click.
Free Online Training
Thesaurus Software and Revenue have teamed up to bring you free PAYE Modernisation training webinars. We have put together a series of webinars aimed specifically at employers who are currently processing their payroll manually. During the webinars, we will look at the advantages and disadvantages of manually processing your payroll for PAYE Modernisation. Places are limited - Click here to book your place now.
Thesaurus Software is at the forefront when it comes to PAYE Modernisation complaint payroll software. With two different payroll packages to choose from - Thesaurus Payroll Manager and BrightPay - customers will be guaranteed leading-edge software and expertise. To help single-employee companies with their PAYE Modernisation duties, we are offering a free BrightPay employer licence for 2019.
Xero enhances platform for businesses and advisers
Xero has announced major innovations and partnerships that help small businesses and their advisers do their taxes simply, access the data they need most, and ensure they can run more profitable, more efficient projects for customers.
Xero also announced the acquisition of Instafile, a UK cloud-based accounts and tax return preparation company that will automate tax filing and financial reporting for businesses in the UK, helping them prepare for Making Tax Digital (MTD) requirements.
The new features, unveiled in front of 3,000 attendees at Xerocon London 2018, make Xero an even more powerful business platform for small businesses in the UK and around the world. They include:
Full compatibility with HMRC’s Making Tax Digital (MTD): Xero is officially ready for MTD for VAT, so businesses who must comply with new HMRC rules for VAT from April 2019 can now submit their returns directly from the platform to HMRC. Customers will have greater control and visibility of their VAT, with the assurance of being MTD-compliant and connected in real-time to HMRC.
Xero acquires Instafile to automate tax preparation: Xero is bringing accounts preparation and tax filing to the accounting platform with the acquisition of Instafile, a cloud-based accounts preparation and tax filing solution that connects UK accountants, bookkeepers and small businesses to UK compliance bodies including HMRC. With Instafile, Xero is future-proofing UK accountants for 2020, the current expected date for mandatory MTD filing across all tax types.
Faster bank feeds from five leading UK fintechs: Tapping into Xero’s new, industry-leading bank feed API, leading financial institutions including Tide, Starling, TransferWise, Revolut and Soldo will now provide faster direct feeds into Xero so businesses can track foreign exchange payments, manage expenses and uncover deep insights about their performance.
Direct onlinefilings for the Construction Industry Scheme (CIS): Available as an open construction contractors will soon be able to file Construction Industry Scheme (CIS) returns directly from Xero, reducing errors and administration.
Automated connections to 150 companies for businesses and advisers: Hubdoc, the newest member of the Xero family, now fetches bills, receipts and other financial documents from more than 150 financial institutions and vendors UK small businesses interact with daily.
Streamlined payroll administration tools: Business owners and their accountants can spend less time on payroll, and more time growing their business, with new payroll employee bulk uploads and direct integrations with NEST, the UK’s largest pension provider.
Powerful integrations with Xero Projects, payroll and Trello: Xero Projects, the simple job costing and time tracking tool, is now more powerful than ever, with integrations to Trello and Xero Payroll, giving businesses a single source of truth on the profitability and efficiency of their projects.
A new Xero dashboard to improve user controls: Navigating the Xero dashboard is now more intuitive than ever, ensuring business owners can find what they need quickly, while accountants and bookkeepers can help guide their clients.
“Making Tax Digital will make business taxes more accurate and more efficient but importantly, with Xero it will be easier than ever for business owners, accountants and bookkeepers to meet their compliance requirements in the UK,” said Steve Vamos, Xero CEO. “The features we’ve announced ... make sure that UK small businesses can spend less time on their business and more time growing it.
Xero accelerates banking connections
Xero is teaming up with five leading fintech groups – Tide, Starling, TransferWise, Revolut and Soldo. The tie-ups will give Xero-using UK small businesses access to more financial information, faster and at no extra cost.
The integrations demonstrate the success of Xero’s new bank feeds API, which uses secure standards including OAuth to connect businesses with data from the financial sources they use daily in one platform.
The NZ accounting software group says it means financial institutions of all sizes can securely integrate with Xero, improving time-to-market for direct integrations as they gain access to a consistent development platform.
Financial data
Whether it’s digital accounts like Tide, digital banks like Starling, foreign exchange platforms like TransferWise and Revolut, or an expense management platform like Soldo, small businesses and their advisers can now choose to integrate their financial data directly into Xero with no additional fees for ease of use from a growing list of fintech service providers.
Xero has also now been granted Account Information Service Provider (AISP) status by the UK Financial Conduct Authority, enabling the company to take advantage of Open Banking in the UK. Coupled with the bank feeds API, Xero is well placed to ensure full market coverage of bank feeds, while ensuring small businesses aren’t burdened with any additional fees.
“These new integrations have been some of the most requested from our customers and with the new Xero bank feeds API, financial institutions can bring these innovations to market faster than ever. As the UK moves to an Open Banking regime, these innovations will enable businesses and their advisors to gain access to the financial information they need to make crucial business decisions, without bank feed charges” said Edward Berks, director, Platform Business at Xero.
Banking landscape
“The UK has a dynamic fintech sector and the latest Open Banking regulations have enabled a huge shift in the banking landscape. With continued development of the Xero platform we can offer automation at scale for small businesses and accountants.”
More accurate data and greater time savings for small businesses and advisors
The new integrations build on the existing connections Xero has to more than 180 financial institutions globally – including HSBC, Santander, Barclays, Natwest and Metro Bank in the UK, and now Absa, a major South African financial institution, helping grow account coverage for small businesses in South Africa.
Direct bank feeds means small businesses and advisers will receive transaction data frequently, directly in the Xero platform, cutting down on time spent reconciling transactions, and increasing data accuracy.
Having direct access to bank feeds from the five integration partners means small businesses and their advisers can more easily track foreign exchange payments, manage expenses and uncover deep insights about their business’ performance.
Small businesses can sign up to direct feeds from their bank in minutes instead of days and, with bank data flowing into Xero automatically. Accountants and bookkeepers can now ensure they are working with accurate data when working with a bank that uses the Xero Bank Feeds API, so they can spend less time chasing information or fixing errors, and more time helping their clients grow.
Driving innovation through integrations
The integrations with Xero will provide new experiences and capabilities for small businesses on Xero through payments, transactions, foreign exchange, expenses and more. They include:
Tide
A digital banking service for small businesses and sole traders. The integration with Xero will save businesses and their advisers time typically spent manually reconciling transactions
“We brought the UK a business current account in minutes. Now, we’re doing the same with our Xero integration — with just a few clicks, we’ll set up a direct feed and automatically sync your transactions every two hours from Tide into your accounting dashboard, saving you from hours of boring admin.”
Laurence Krieger, COO, Tide
Starling Bank
The UK’s mobile-only bank, offering current accounts that connect to its Marketplace, the financial hub for customers to access financial products and services, such as Xero.
“Small businesses have always been the backbone of the UK economy, but yet the big banks continue to overcharge and underserve some of the most important people in our economy. We wanted to change that. Today we’ve taken another big step in changing the way these small businesses manage their finances.”
Megan Caywood, Chief Platform Officer, Starling Bank
TransferWise
TransferWise is a new kind of financial company for people and businesses that travel, live and work internationally. Over four million people and businesses use TransferWise to transfer over £3 billion every month, saving themselves over £3 million every day.
"International business banking is too expensive, complex and time consuming. TransferWise is offering a better alternative that is already helping our 150,000 business customers take their businesses global. Integrating with Xero has been one of our most requested features, so that
accountants and bookkeepers can conveniently and accurately reconcile their international currency accounts."
Stuart Gregory, Head of Business, TransferWise
Revolut
Revolut provide Personal and Business accounts to over 3 million users, for holding, exchanging, sending and spending funds without terrible fees.
"Integrating with Xero is part of our vision to build the most seamless business banking platform in the world. At Revolut, we want to help businesses safely and effortlessly connect their finances to the tools they love. Working with Xero will make it even easier for us to help our business clients connect all of their data and create meaningful insights that lead to better business decisions.”
Nikolay Storonsky, founder and CEO, Revolut
Soldo
Soldo is a multi-user expense account that gives businesses complete control of company spending and automates the entire expense management process.
“Xero offers transparency into company finances – and Soldo matches it with complete visibility into spend. By integrating, we can put all the data a business needs for real-time accounting in one convenient place: letting accountants spend more time advising clients – and less on frustrating admin tasks.”
Darren Upson, VP Small Business Europe, Soldo
Global Bookkeeping Week focuses on MTD challenges
Bookkeepers are taking part in Global Bookkeeping Week, an international celebration of good bookkeeping and its transformative power for small businesses.
It's a celebration of a profession that has its origins in the manuscripts of 15th century Franciscan monk Luca Pacioli and that is now getting to grips with cloud accounting.
Dinah Scudder, of Scorpion Bookkeeping Services in London, will be meeting her fellow members from the Institute of Certified Bookkeepers (ICB) to raise a cup for their profession on Wednesday 21 November.
Bookkeepers who do VAT and tax returns for local businesses, will be meeting at Costa Coffee on Tooley Street, London Bridge, to celebrate the event.
Seamless transition
"We are embarking on software training courses to ensure that we are equipped to help our clients make a seamless transition when MTD for VAT comes into effect," says Dinah, who left a job in Barclays Bank to set up her own bookkeeping practice.
ICB Bookkeepers have seen increased demand for their services over recent months as businesses struggle to get to grips with Making Tax Digital (MTD); the HMRC initiative that affects VAT-registered businesses with turnover over £85k from April 2019.
Catherine Pyman, owner of CPY Business Solutions Ltd in Knaresborough, N Yorkshire, says: "The role of ICB Bookkeepers has never been more important. There is a lot of new, cloud software but nothing can replace a bookkeeper.
Power to transform
"If you're a VAT-registered business with a taxable turnover above the VAT threshold, MTD means you must now use commercial software to maintain your accounting records and file your VAT returns online. Just 3.5 per cent of businesses in this category are exempt and you'll no longer be able to use the usual HMRC VAT form,' says Jacquie Mount FICB, ICB's head of technical policy.
Global Bookkeeping Week will see ICB Bookkeepers in the UK link up with a 150,000-strong community of students and members of ICB Global.
Putting you back in control
President and co-founder Garry Carter, says: "Good bookkeeping has the power to transform!
"Gone are the days when you could get through your first year of trading and find out you couldn't pay your tax bill.
"Bookkeepers not only save you time and money, they talk in a way you understand, putting you back in control of your finances and making sure you're ready for MTD and whatever comes next.'
Global Bookkeeping Week ICB's headquarters in New Zealand, Australia, The Philippines, Singapore, the UK, Ireland, and North America.
Fintech high flyers Fluidly raises £5m in funding
Fluidly, a London-based fintech startup delivering intelligent cashflow management for SMEs, has completed a £5m Series A funding round.
Fluidly defines a new software category – Intelligent Cashflow. Cashflow management is the single biggest financial pain-point that businesses face, and knowing their future financial position is of critical importance. Fluidly uses machine learning to predict and optimise the future cashflows for SMEs and provides the key to financial decision-making.
Fluidly is a SaaS platform that integrates with both cloud accounting packages and Open Banking APIs.
Expanding the team
New-York based Nyca Partners led the round with participation from other investors including Octopus Ventures, Anthemis and tech angels Simon Murdoch and Charlie Songhurst.
The money will be used to expand the team of engineers and data scientists working to advance the product, and also to build sales and marketing capacity.
Since launching a year ago, Fluidly has grown rapidly and is now working with nine of the Top 20 UK accounting firms, (including BDO, Mazars, Baldwins and Haysmacintyre, as well as numerous smaller accountants) to reach thousands of SME end users.
Fastest-growing apps
Fluidly has also formed partnerships with leading cloud accounting software providers, becoming one of the fastest-growing apps on Xero’s marketplace and a Champion-level Sage partner.
Fluidly’s success has been widely recognised as evidenced by its winning of both “Innovation of the Year” and “Forecasting, Planning & Analysis Software of the Year” in industry awards held earlier this year.
It is one of 12 fintech businesses participating in the final phase of Nesta’s Open Up Challenge that concludes at the end of 2018. Fluidly is already a previous winner of Stage 1 which rewarded 20 companies with £100,000 in July 2017 that have developed innovative and credible ideas to transform small business banking.
Founder and CEO Caroline Plumb said: “It has been an incredibly exciting year for Fluidly. We have experienced a phenomenal period of growth and this latest investment will enable us to scale the business even further. Cashflow forecasting and management is the key to financial decision-making – we’re on a mission to help millions of business owners sleep better at night by giving them control, certainty and confidence in their financial future.”
Hans Morris, Managing Partner at Nyca said: “We are thrilled to have joined Fluidly on their journey as they grow into a major AI/ ML player in the financial technology industry. Cashflow management for SME’s is an area that is long overdue for the kind of innovation that Fluidly is providing, and we look forward to supporting them as they focus on new product development and expansion of their impressive customer base.”
Will Gibbs, Investment Manager at Octopus Ventures commented: “Cash flow is mission-critical for business, but it’s an area that’s seen little in the way of disruption. Many business owners continue to rely on spreadsheets and guesswork to manage it.
“Fluidly understand that AI can help, allowing businesses to make better forecasts and better financial decisions.
“This is a proven, fast-growth business that we are proud to have supported from an early stage. We are delighted to be working with Fluidly as they continue on their growth trajectory to expand their product, data and engineering teams.”
Accountancy and a tale of one city...
Here is a tale of one city ... and two conferences.
The city is London, the globe's leading financial centre and home to some of the world's most quarrelsome (NB polite word) politicians. Well, this week it played host to two accountancy conferences.
The words accountancy and conference describe both events adequately. After that things get a bit more tricky.
Enjoyable and educational
The two gigs were equally enjoyable and educational - but they couldn't be more different.
The first was Xerocon, a colossal two-day celebration of accounting and more put on in three sprawling hangars at ExCeL by one of the world's leading software group's Xero. I reckon about 3,000 folk from the Xero community and elsewhere in the accounting world let their hair down.
The second was the Institute of Chartered Accountants England Wales Connecting in a Digital World conference. A quieter and perhaps more cerebral affair not far from the institute's historic HQ in Moorgate. I reckon about a couple of hundred or so were there.
Scale, ambition and inspiration
I loved both. Xerocon for its scale, ambition, and inspiration. Xero's chief Steve Vamos drives home a message of 'we help small business the world over thrive and prosper' with concise convicition.
He and his team pulled-off a jaw-dropping extravaganza, complete with zip wires, DJs, rockbands and a keynote stage as wide as a football pitch is long. Not to mention accountancy. And they succeeded in keeping all this razzmatazz on the right side of taste... no mean feat.
History and professionalism
And I loved the ICAEW event because of its history, its commitment to professionalism, its intellect and its endeavour.
For me, the whole ethos of the institute was encapsulated in a practical accounting update by Vivek Mehen of the ICAEW.
My hat goes off to the guy who studied chemical engineering at Cambridge for his wit, passion and forthrightness in delivering a one-hour plus lecture on the nitty-gritty of non-tangible assests. And making it interesting. To a non-accountant! Amazing!
I'll be writing more on both these events next week. But that's all for now. Have a great weekend!
Why an Accountex 2019 speaker slot is an amazing opportunity
The Accountex team is busy organising an exciting and enlightening speaker programme for 2019's main event at London's ExCeL on May 1-2.
The line-up is starting to take shape ... but speaker submissions are still being accepted up until 28 November. If you'd like to get involved, we'd love to hear from you.
- If would like to send us a speaker submission form you can use the link here:
You might have new slant on an old topic; you may be able to communicate an insight that will revolutionise the world of accounting; or you may be able to help accountants deploy artificial intelligence to their best advantage.
We've asked some of our speaker friends to explain why Accountex is a such a great opportunity...
Alex Falcon Huerta, Soaring Falcon Accountancy: “Speaking at Accountex gives you the opportunity to share you knowledge and to help others. It's the value that you can provide to take pain points away and it gives confidence to those who are unsure of the steps to take. We have all been there at some point... when someone has done this and achieved it, why not give back. It may be a scary thing to speak, but you're just talking about what you know and probably what you do every day. It can add credibility, trust and confidence to your customer base - it shows you're leading the way and being at the front end.”
Joanne Wharam: Smart Support for Business: Speaking at Accountex helps me in various ways. For anyone who has a fear of public speaking, which is the second biggest fear we have after death, Accountex with theatres of varying sizes is a great way to grow your confidence and skills. As the audiences are small and friendly the prospect is far less daunting and you have the team to support you on the day with the IT. Not only that but it helps to build my credibility as an adviser to the profession and the additional promotion that the Accountex team do helps to widen my audience.”
Mark Lee – Book Mark Lee: I speak professionally as I get a real buzz out of entertaining, inspiring and helping an audience from the stage.
Elaine Clark – Cheap Accounting: Meeting peers and sharing experiences is what Accountex is about for me. It’s an opportunity to pick up new ideas, ratify thinking and have some strategic headspace in this fast moving world.
Martin Bissett - The Upward Spiral Partnership: The accounting profession is the ONLY profession that shares a level of 'financial intimacy' with their clients that allows the accountant to influence profound improvement in the lives of their clients, even to the extent of realising those clients' personal and professional aspirations. That's why it is a profession and not an industry and rarely does the opportunity, such as speaking at Accountex, come along for us the speakers to positively influence so many individuals with life changing skill sets in one event.
Jo Tomlinson – Business Works: The reasons I speak at Accountex are: 1) I love it; 2) It raises my profile; and 3) When I speak to general business owners it is also a great way of marketing our business and being seen as a trusted adviser.
Della Hudson - Business consultant: I still hate public speaking but I know that there are things I can do that others can’t so I want to help them. Modern accountants collaborate and share information and Accountex provides an ideal forum, either speaking from the stage or 1:1 conversations.
Amanda C Watts – Twenty Two Agency: One of the most amazing things about Accountex is that they give an opportunity to the whole of the industry to have a say. With the profession being pulled from pillar to post with MTD, technology disruption (opportunity) and the cloud NOW is the time for everyone’s views and experience to be shared.
You only need to touch one life with your message and you have changed the world. We all have an opinion, and you have something that you believe can make this world a better place. Unfortunately we rarely feel confident enough or have the opportunity to share and take action on our thoughts.
Accountex does, however, give us this opportunity. Whether you want to help accountants systemise, attract better staff, use technology in a wiser way, learn how to serve clients better, be seen as more valuable and vital, it’s time for you to leverage this platform.
If you have something to say but are unsure as to whether it will be valuable, apply anyway. What you may think is common knowledge is often unknown by the masses. The profession needs accountants who have insights, technology firms that have systems and men and women who have a dream to make a difference.
Apply now and contribute. Accountex and the profession need you. Make a difference and spend 40 minutes in May sharing your insights and ideas.
Carl Reader, Author, Speaker, Expert: Magic things happen when you speak to your peers within your own industry. They don’t just steal your ideas – instead, you become centre of attention in a good way. People share things with you. You get invited to events. And, the ‘halo’ effect benefits your career and your business. There’s no better place to share your knowledge than Accountex – the UK’s largest exhibition for the accounting profession.
Rob Brown - Speaker, Author of Build Your Reputation: People who are offered the opportunity to speak at Accountex are given a platform to share their message, network with fellow influencers and raise their profile at the UK's largest and most prestigious business events.
Here’s a bit of extra info to get you in the mood:
- We have 8,000 visitors at the two-day event
- We attract about 250 exhibiting companies including Sage, Xero, Intuit Quickbooks. Plus numerous cutting-edge groups and start-ups.
- We also have 11 themed CPD theatres with 200 speakers.
- In terms of the visitors, 65% are accountants in practice and 35% are from accountant in business – most are from SME companies.
- Check out the event website here: www.accountex.co.uk
Meet Dexter ... Xero's new “face” of MTD
Dexter the Digital Tax Advisor has been unveiled by Xero, the accounting software platform – to help accountants and small businesses prepare for one of the biggest changes to UK business tax in decades - Making Tax Digital.
From April 2019, every VAT-registered business above the £85k threshold will be required by law to go digital and file their tax through Making Tax Digital (MTD) compatible cloud software. Before then, over a million small businesses need to get ready. But with less than five months to go before the legislation is introduced, research has found that fewer than half of the UK’s accountants (43 per cent) feel prepared for the change.
Crowd of 3,000
Commissioned by Xero, the cartoon series has been created by the Oscar-nominated artistic duo Alison Snowden and David Fine, with a short teaser revealed to a crowd of around 3,000 accountants and bookkeepers at Xerocon London this week.
The animated series of short films starring Dexter the Digital Tax Advisor will be released in the lead-up to the MTD for VAT kick-off date. The character has been launched to concentrate minds ahead of the shake-up, showing accountants and businesses how easy it is to make the switch to digital. Given that tax has historically been viewed of us a highly tedious task, Dexter’s mission is to highlight the benefits in efficiency and offer peace of mind in the months ahead and beyond.
Of the 200 accountants and bookkeepers surveyed, almost half 45 per cent were unaware of the penalties for non-compliance, which will be points-based and carry a charge after four late submissions.
Firm's productivity
Despite fewer than half of accountants being prepared for the change, almost one third (30 per cent) of those surveyed said they expect digital tax to increase their firm’s productivity, with 51 per cent admitting that online software is already improving collaboration with clients, as well as increasing speed (46 per cent) and reducing the amount of errors to fix (28 per cent).
When it comes to small business owners, one quarter (25 per cent) admitted they are completely unaware of the upcoming legislation. The research comes as HMRC has issued 20,000 letters to small business owners informing them of the upcoming change, requiring businesses to make a significant change to the way they submit their VAT returns from April 2019.
The research also found that almost a fifth (18 per cent) of accountants think their clients are concerned by the amount of extra time they will need to spend doing tax returns once MTD for VAT begins. However, the data reveals that accountants expect VAT returns to reduce by 6.42 hours a week by using cloud accounting and submitting VAT returns digitally. This in turn frees up more administration time for firms to spend on higher-level advisory services, which Xero’s separate Benchmarking Report has found can increase firm revenue by 12 per cent on average, as opposed to the UK average of 3 per cent.
Making tax digital
Dexter the Digital Tax Advisor launches as Xero announces it is officially ready for Making Tax Digital as well as thousands of Xero accounting partners. As a HMRC approved supplier for Making Tax Digital for VAT, Xero’s new VAT functionality is now in public beta and is completely compatible for Making Tax Digital for businesses over the VAT threshold.
Damon Anderson, Director of Partner and Product at Xero says: “Making Tax Digital is going to usher in a new era of accountancy, encouraging the technology adoption and working practices to bring the profession into the 21st century. Our data has shown that there are huge numbers of small businesses who still feel unprepared for the legislation, so we’ve created Dexter the Digital Tax Advisor to be the voice of Making Tax Digital for VAT and help accountants and small businesses on their digital journey and make tax less taxing.
MTD is just the start of technological innovation for the world of accountancy. It’s going to drive widespread adoption of digital technology, introducing new innovations, such as AI and automation. And at the core of this, we’ll see accountants experiencing a technological and cultural shift, in which paper and outdated desktop software will be replaced with the latest digital technology equipped to evolve with new legislation.”
For further information on Making Tax Digital for VAT visit Xero's Making Tax Digital hub.
Minister signs up for ICB talk on future of accountancy
The Institute of Certified Bookkeepers is hosting a roundtable at the WorldSkills UK Show at the NEC, Birmingham, on Thursday 15 November that will tackle the future of the bookkeeping and accountancy.
Anne Milton MP and minister for apprenticeships, the National Apprenticeship Service, ICAEW and Sam Hurst, an apprentice from Accumulus Accounting who is doing his Level III accounts assistant apprenticeship with Riverside Training Spalding, will be on the panel.
Sam is one of 369,700 apprentices in England in 2017/2018 who has been 'learning while earning' on a government-backed apprenticeship scheme.
Fully integrated
Victor Gidney, senior tutor at Riverside, says: “The purpose of our apprenticeship training is to transform our students into better bookkeepers and accountants. We do this by ensuring that our curriculum is fully integrated into the workplace once the apprentice has finished their training.”
On 29 October 2018, Philip Hammond, chancellor, announced greater funding for apprenticeships for small businesses and released details on how larger levy-paying businesses can use up to 25 per cent of their levy to fund apprenticeships for businesses in their supply chain.
These measures will enable the 95 per cent of businesses that are non-levy-paying to take advantage of the benefits of apprenticeships for employees of all ages, ensuring they have the skills needed for growth.
Accountancy career
The ICB apprenticeships offer an alternative, funded route into an accountancy career to those individuals who do not have a university degree. “We’re committed to helping a diverse range of people become professional bookkeepers or begin their path towards chartered accountant status," says ICB head of technical policy Jacquie Mount.
"We believe the government should do more to support non-higher education access routes to all professions.”
The ICAEW, which awards credits to students who have completed ICB qualifications, is attending the official launch of the ICB Apprenticeships at the show.
“We know employers and students value these apprenticeships and we are working closely with ICB to support unconventional routes into accountancy. We look forward to continuing to collaborate with ICB as they welcome students, employers and bookkeepers from diverse backgrounds."
Check out: www.bookkeepers.org.uk