No Accounting for Taste ep221: The fallout from MTD’s first deadline

The deadline was the 7th of August and HMRC had previously indicated that they expected about 864,000 taxpayers to be required to join MTD from April 26.

The stats indicate that more than 570,000 are registered, but only 436,000 had successfully filed by around the 12th of August.

What's your take on the numbers? So, yeah,

I think while 864,000 were in scope, i.e. sole traders or landlords with a turnover of more than 50,000, exemptions applied, don't at me, I'd say they probably were not expecting.

You know, I'd be fascinated to know what they did expect, but I think around half... actually filing anything is that good i guess we'll know once we get to q2 q3 it's probably a good thing that they uh they hit that magic 50 number that that just feels a bit better doesn't it

It does.

It does.

Yeah.

I feel like it's a good thing that they can the penalties for late submission and put that soft landing in place because otherwise I think there'd have been just a gigantic outcry.

Their reaction to this was an interesting one because HMRC said they were happy with the numbers.

but then added that from September it will also be signing up any remaining taxpayers it believes to be in the scope of MTD for 26-27.

It feels a bit like saying, yeah, I'm absolutely happy having a pizza without ketchup and then adding your own ketchup just to make sure you've got it.

It's a strange one, isn't it? Top ketchup-based analogy there, Matt.

Enjoyed it.

Thank you.

It's a bold move, but I think it's necessary.

I think once we get to the sort of later submissions, once we're getting onto that final return, once penalties come in and people are sort of scrambling around looking for stuff, signing up at the last minute, then, you know, I think they're just trying to get ahead of the game.

I guess when we published something about this on AccountingWeb, I think there was a strain of accountants that kind of felt like, why did I bother signing up my clients? So it was a bit of frustration there, but I think I'd argue actually the best way is to take a look on behalf of your clients, because then you can actually see what figures HMRC has, where is it pulling them from? If they're correct, you know, you're in control of that.

So, uh, Yeah, in terms of how it'll actually work, it was unclear in the press release at the time, but actually I think the ATT have actually released a few details since then.

So HMRC will move them across to the system and then the taxpayer will have to go in and there's a specific checking step.

that HMRC have added, which requires the taxpayer or their agent to confirm whether HMRC's records are up to date.

So they'll need to log in via the personal tax account or the business tax account or through the agent services account, and then just check and confirm that HMRC's information on the business is correct.

You know, I think it's possible to notify them the business is no longer active as well, or if it ceased trading.

And I think there'll be communication with HMRC to the taxpayer or their agent around this nearer the time in September as well.

You talk there a little bit about accountants feeling a little bit, why did I bother? And I think if you look to HMRC's numbers, you'd probably say Q1 kind of went okay.