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Readers’ correspondence.
Making tax digital
Andrew Hubbard’s article ‘Pause for thought’ (Taxation, 7 October 2021, page 8) was much needed and I am certain echoes exactly what agents dealing with small businesses feel about making tax digital (MTD). We do feel abandoned by HMRC. The headline issues for me are:
- My clients cannot afford expensive software. How do I advise them on ‘free software’? HMRC is shunting this on to us and not providing the necessary software. As usual for HMRC someone has a lightbulb idea. No thought for the end users. It must provide software.
- Please stop the mantra that MTD will stop errors. It won’t. MTD is not a magical fix. Errors will continue. Indeed MTD will cause errors. The input will be done by humans and we all make mistakes.
- Clients can easily input information using MTD. What they cannot do and why they need us agents to police and advise is know what they can claim for and all the complicated nuances of the tax system which MTD does not address. Here is an example. A client of years standing wanted to claim for a new gas boiler in his home. This, after my banging on for years about ‘wholly necessarily etc’. He needed the new boiler and took some convincing it was not an allowable expense. He is a freelance musician.
- I submitted a new capital gains tax return for a non-resident client in April 2021. I only received acknowledgment and a request for payment in mid October. Don’t blame Covid for delays. This is a new way of collecting tax and HMRC is taking months to deal with it. I fully expect MTD as it is proposed will be just as chaotic.
- The £10,000 threshold is ludicrous. The personal tax allowance is currently £12,500.
Like Andrew I have a final plea and that is for HMRC to listen. It is not on the side of the self-employed – it is more interested in saving costs. Gerri Baird.
Request to move the filing deadline
I would like to make a formal request for HMRC to consider deferring the filing date for 2021 self-assessment returns to 28 February (2022) as it did with the 2020 returns. To be clear, this would just be a deferral of the £100 late filing penalty.
There is no doubt that we have all been affected by the continuing Covid epidemic, whether it be from the additional requirements of clients going through extremely tough times or staff being off with Covid-related illness. Add to that the issues of not being able to obtain UTRs for clients, the whole additional time requirements of the 30 (60) day capital gains tax reporting and a myriad of other extremely time consuming issues, then you will get some idea of where we are on the agent side.
I do not see this as encouraging people to ‘take their foot of the gas’; there is no time for that!
HMRC waiting times
I was surprised about the reported time for HMRC to deal with an online tax return repayment application of 203 days in ‘Do as I say, not as I do’ (Taxation, 18 November 2021, page 22). But I note the service covered in the article relates to individuals completing their own returns.
I keep a record of both the tax return submission date and repayment processing date for my clients and these are generally dealt with in around seven days, which is very good.
Last year one of my clients was due a large repayment which was processed in nine days which I was pleasantly surprised by.
Stephen Kattau.
