HMRC projects at risk from Brexit pressure – could MTD be a casualty?

Speed Read Because of Brexit pressures, HMRC may attempt to make efficiency savings, which could result in cuts to the level of support services available to smooth the introduction of MTD.  With this in mind, the message is clear; if your business is part of the first wave of VAT registered business to be brought into MTD from April 2019, it’s imperative you get your accounting systems ready now.  The Cloud based options we offer are simple and perfect for the job.  Implementing these now will ensure their businesses can deal with any bumps in the road to MTD, as well as delivering far better, and real time, accounting information to help with their key business decisions. Background Information Before you get too excited, in this context the use of the term “casualty” does not envisage a fatal setback to HMRC’s flagship project, but Brexit pressures certainly have the potential to inflict more than a glancing blow to MTD. In an update to Parliament’s Public Accounts Committee, HMRC’s Chief Executive, Jon Thompson, has “proposed a number of projects which should stop, or not start, and a number which should be stretched out over a longer scale” so that HMRC can prioritise and manage its Brexit workload, which is significant. The timing of MTD for VAT, which will see 2.3million businesses make regular online tax returns to HMRC, is two days after Brexit, which puts HMRC under significant pressure to deliver a robust and tested MTD platform, whilst simultaneously delivering an IT programme to deal with post-Brexit customs declarations, which are projected to increase nearly five-fold. Will we see MTD shelved, we think not, but the most recent forecasts do show MTD will not deliver significant savings to HMRC in the short term, so it is easy to see the rationale for putting MTD on the back burner, more so knowing that, of HMRC’s top five biggest projects, three are classified under the MTD programme.  MTD is nice to have, but the customs declaration systems are essential, so creating some slack in the former will help divert resources to the latter. It seems more likely that HMRC might attempt to make efficiency savings, which will invariably result in cuts to the level of support services available to smooth the introduction of MTD.  With this in mind, the message is clear.  If a business is part of the first wave of VAT registered business to be brought into MTD from April 2019, it’s imperative they get their accounting systems ready now and as a firm we will be highlighting to our clients any problems we might foresee in the MTD road. The Cloud based options we offer are simple and perfect for the job.  Implementing these now will ensure clients’ businesses can deal with any bumps in the road to MTD.  Clients should also find our Cloud based options give far better, and real time, accounting information to help with key business decisions.