The filing of corporate tax online is set to become mandatory in the UK in April this year, despite questions being raised about the implementation of the software underpinning the government's shift to the web. The Inline Extensible Business Reporting Language (iXBRL) has been coded into products by over 30 commercial suppliers …
Why are they so late?
Given that they have had five years notice and there is a ready market for the software, why on earth is Sage not in a position to release an iXBRL tool in time when their main competitor IRIS has a number of options and even the small guys like Unit4, Alui and VT have solutions out there.
Because of the sterling reputation
HMG have of carefully defining standards, and then never ever changing them.
Re: Why are the so late?
The ones that are ready only produce accounts for small companies with reduced disclosure requirements. Sage, Thomson Reuters and presumably the two big four accountancy firms listed are the only ones that can cope with large company accounts, listed plc accounts and group accounts. They have much more complex disclosure requirements, and hence a lot more work to get it operational.
Sage's corporation tax software was previously written by Deloite before they sold it to Thomson Reuters. Presumably they still use it, so that is at least three of the big 4 that are not ready.
re: even the small guys
From experience I'd expect the small guys to be ready before the big ones - I suspect because the owners/managers are much more in tune with what pay's their wages
Someone save us from the CT600 PDF!
Let's hope someone comes up with a (cheap, simple, i.e. not Sage) package to do iXBRL filing soon, otherwise we'll be stuck with the diabolical CT600 PDF for another year:
More ranting on this subject at: http://sandtreader.wordpress.com/2011/01/01/government-ui/
The CT600 PDF catastrophe
The CT600 PDF disaster is not just a UI problem. We very carefully downloaded a copy of it in plenty of time - months ahead of the filing date, and filled in almost all the numbers. The day before our filing date we filled in the remaining numbers and submitted it. Which failed, eventually leaving us with a CT600 PDF file which would essentially only display a blank page.
This turns out to be because the halfwits at HMRC had //changed the interface// since we had originally downloaded the form, so the old form which we had could not now be submitted, and in fact would not even let us see the numbers in it. Needless to say we didn't find out anything useful from HMRC but worked this out ourselves. We eventually worked around the problem by: reverting to a backup of the CT600 PDF file (a very good thing we kept lots), which would still let us see the numbers, downloading a new one, //type everything in again//, and submit it.
Whoever designed this needs a good killing.
claim tax relief on the time spent trying to make a return,
Someone save us from the CT600 PDF!
As the owner of a small business, I'm posting this to say I thought the PDF filing which was able to generate CoHo and HMRC filings worked really well - especially for a 1.0. I admit I got caught out one time because an error message was still displayed after I'd corrected the entry error and I spent 10 minutes trying to figure out what I'd done wrong before pressing the 'Next' button anyway.
Yes, it's a little annoying to have to enter last years number but, come on, not the end of the world. Yes, it would be good that all values entered in one section carried over but it's only 10 seconds of your life. And yes, it would good that the tax calc was done (but as you point out you'd do it anyway). Since you rant about Small Pool Allowance presumably your affairs are more complicated. But you alway have the option to use a 3rd party tool. You don't HAVE to use the free PDF option. Presumably there's a vendor out there which does accommodate your needs already. You pays your money... (or not in your case).
For my part, I think this way of submitting the CT600, which borrows from what CoHo has been doing for a few years, it an improvement. Not a massive improvement, but an improvement.
Make the software companies part of a trial run whereby they will have to complete their own tax return in the iXBRL format.
Nothing like a swift kick from the finance department to get development going.
This seems like a typical cost saving measure.
The tax office will likely save £1000 because companies use this new system, meanwhile the costs to companies will be in the £Ms.
Seen somehthing similar with the insistance at my last place that all VAT on orders was reclaimed. There were stupid things like ~£60 being spent to reclaim £1 in VAT hundreds (or thousands) of times!
The Government has never grasped the fact that money can actually be spent more productively than on complying with their bullshit. R&D is typically a good productive area to spend it. Never mind, eh? Obviously much better to be subservient to HMRC's current whim.
Let's hope Sage accounts *lots* better than Act
Which Sage bought.
Dog slow and buggy as hell*
But *five* years notice
Note this was bought off the shelf before we learned of the update versions.
Sage prepared for change?
I'd suspect this will be unlikely - their top-tier system is still based on migrated SCO Openserver binaries from the early nineties, and they contantly have issues updating them for anything vaguely new...
If only things were that straightforward ....
HMRC have been banging on about XBRL (not inline XBRL) for some time, but it was not until approximately 12 months ago that they decided to use the proposed (at the time) inline XBRL standard - sending people who might have started something in standard XBRL back to the drawing board.
As for Inline XBRL - it was only approved as a standard in April 2010 and ratified in May - so the ink is hardly dry.
And on top of this currently HMRC don't even comply with the published standard yet - they are still on an earlier 'candidate release' that has issues accepting those documents that do use the official standard.
Even though XBRL is used world-wide and has been for many years, the UK has decided to go down the inline XBRL route, and as such the world's first inline XBRL 'pilot' is to be undertaken by ~2 million UK corporate tax filers starting from April ...
Why do HMRC want inline XBRL ? Well inline embeds the XBRL into an HTML document that human beings can read, as opposed to usual XBRL with is a variant of XML with knobs on.
Because HMRC don't have any software that their tax inspectors can use that makes sense of an XBRL document, and are not prepared to spend any money to develop one, it is much cheaper for them to mandate that the submitters do it for them.
The upshot of this is now Companies House will also move to inline XBRL for the filing of statutory accounts, having so far accepted voluntary XBRL filings - so all change yet again - the only positive here being that the same document should be acceptable by both HMRC and Companies House. The intention is that this will be mandatory from April 2013, legislation permitting - hopefully the software companies are listening a bit more intently this time.
The real short-term goal, as pointed out, is to do away with the paper and force electronic submissions, as this removes government post rooms (> 5 million documents per annum for Comapnies House even though electronic submission is well over the 50% mark) plus the miles of shelves to keep them on.
But be prepared for it to all change again when companies are forced to adopt IFRS reporting.
As for Sage filing their accounts, well Sage are so big that they cannot use their own software, but use a Hyperion consolidation system to get their figures, So unfortunately no "eat your own dog-food" here.
Anonymous as I work for an XBRL provider ... and yes it is harder than it needs to be
On top of this...
One of the big 4 accountancy companies decided sometime last year to outsource all of their development capability to India, this meant that all of the developers were laid off in December, including the one guy who was working on the necessary changes for iXBRL, and the analyst/subject matter experts are now working as relationship managers.
Nothing like forward thinking...
You may need to think about a different job
As someone who works for a vendor your comments are surprisingly misleading.
Let's start with a clarification: iXBRL is XBRL (the same as might otherwise be submitted) embedded in an HTML document. Nothing fancy or new as embedding XML in HTML has been part of HTML for years.
I'm pretty sure I've seen contributions from Andy Greener and company at HMRC about iXBRL for considerably longer than 12 months. That it takes the XBRL community a long time ratify a standard is not really relevant. What's important to vendors it that HMRC stipulated the candidate release of iXBRL and stuck with it. Are the tax returns going somewhere else?
But there's nothing to stop vendors supporting the final standard as well. We're not talking about rocket science here. It's some tags in an HTML document.
So why iXBRL? The Companies Act is really clear that the information company secretaries (I'm one) provide to HMRC must be capable of being rendered in the way it was when the directors signed them off. It help to reduce the "Oh, I didn't sign those" excuse. So submitting an XBRL formatted document (XML) on its own is not an option.
5 years ago CoHo tried to use a on-size-fits-all xslt approach for CoHo XBRL submissions but found it did work because everyone's accounts are different. So iXBRL was born (yes, years ago). iXBRL allows a company to present the information I WANT TO and also include the submission in a machine processable format. Is that is bad?
Spot on. This has been been going on for a number of years - and as usual the vendors have dragged their feet as they do not like being told what to do. Then again they bleat if 'free' software were to be provided by HMG.
And wouldn't it be a time saver just to have to be able to make just one submission and let the systems direct relevant data to CoHo and HMRC?
Private Sector businesses just get in the way
The final solution would be for the government to develop an accounts package and compel all businesses to use use it by, say, 2030. HMRC can give it away for free, every accounts worker gets a fully transferable skill, no duplication, no duplication/obfuscation by crappy SMB/SMEs etc
It isn't ordinary accounting and bookkeeping packages that HMRC is happily noting as iXBRL-compliant, and there aren't (AFAIK) add-ins for Excel and Word (which are the means for producing final accounts for a handful of tiny companies I do returns for).
What we are talking about are the specialist accounts-production packages that are used by medium and large sized accountancy firms. Good luck with this new regime of you are a one-man band accountant who typically produces accounts manually - or uses one of the simpler specialist products out there, or a WP and a spreadsheet - or one of the many thousand small firms below the audit limits or semi-dormant who do not even use an accountant at the moment.
Tax compliance just got considerably more taxing, because you have to get an accountant if you didn't need one, and your accounant has to go to one of the big boys licensed by HMRC (with no real guarantee that their products will work or he can learn how to use them in time).
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