The National Audit Office (“NAO”) has published its report “Progress with Making Tax Digital”. The report considers progress to implement Making Tax Digital (“MTD”), and whether HMRC’s latest plans provide confidence that the programme will deliver value for money. Its main conclusion is that the repeated delays and rephasing of MTD has undermined its credibility and increased its costs. . HMRC has responded to the NAO’s report in an email from its CEO, Jim Harra. Specifically, the NAO report looks at:- HMRC’s original vision, options and plans for MTD; HMRC’s progress between summer 2017 and the end of 2022; and the realism of HMRC’s latest plans. The report focuses on the MTD programme from 2016 onwards and does not assess wider changes within HMRC, but these are referred to where they relate to MTD. Appendix one describes the NAO’s audit approach and evidence base. Appendix two shows planned implementation dates for digital record keeping by business taxpayers since 2015. The report’s conclusions are set out below. HMRC’s vision to digitalise the tax system has the potential to bring about a step-change in the system’s efficiency and effectiveness. The principle of digitalising tax has broad support among stakeholders provided it makes it easier to pay tax. HMRC launched digital record keeping for VAT for larger businesses on time, but it needed more time to move taxpayer records off legacy systems due to the extent of data issues it had to deal with. The report found that HMRC’s initial timeframe for MTD was unrealistic. It did not allow sufficient time for HMRC to explore the full range of options that would achieve the programme’s aims and select one that it could implement. Each announcement has set an ambitious timeframe for delivery, with several aspects of the MTD programme to be delivered in parallel. The repeated delays and rephasing of MTD has undermined its credibility and increased its costs. There is a risk that delivery partners and taxpayers disengage from a programme that can only succeed if those groups significantly change their behaviour. Higher costs were not inevitable, had HMRC taken more time to plan and consider the realism of the options. The report further concluded that HMRC has not demonstrated the programme offers the best value for money for digitalising the tax system, with later business cases significantly underplaying the total cost to customers of making the change. The programme should now develop a robust business case which includes a comprehensive and up-to-date assessment of the costs to customers of implementing MTD. Planning was also found to have been too high-level and the risk remains that further delays will add costs and defer benefits. HMRC is reviewing how MTD will work for businesses and landlords with lower Self-Assessment income. The report found that it should take this opportunity to assess how far the programme is improving services, reducing burdens, and making the tax system easier to comply with and use lessons from this review to ensure the wider programme is finally on track to secure the benefits it has long promised.

Do you complete expenses and benefits returns? Or do you complete online filing for employment related securities? If so, you have an important role to play in ensuring returns are submitted by the 2022/23 filing deadline of Thursday 6 July 2023 and payments are made on time. By way of reminder, from 6 April 2023, forms P11D and P11D(b) can only be submitted online by employers (except for the digitally excluded). Note that ICAEW has shared how filing P11Ds online can work when a different agent is authorised for PAYE. Amendments can also only be made online from the same date. Also, since 6 April 2023, a new online service is available for employers and their agents to apply for a PAYE Settlement Agreement (“PSA”).  Here’s a reminder of the key deadlines next month:- 6 July 2023 - deadline for submitting all 2022/23 P11D(b) and P11D forms - and the employee must receive their copy of the P11D; 6 July 2023 – deadline for online reporting of the 2022/23 annual return in respect of employment related securities; 19 July 2023 - deadline for non-electronic payment of Class 1A National Insurance Contributions (NIC) for 2022/23; and 22 July 2023 - deadline for electronic payment of Class 1A NIC for 2022/23. To save on administration, don’t forget to consider PAYE Settlement Agreements, where relevant. For 2022/23 these must be agreed by tomorrow, Wednesday 5 July 2023, with payments due by 22 October 2023 (19 October 2023 if paying by post). HMRC is also reminding employers of the expenses and benefits position of COVID-19 position of tests and equipment.

ECOFIN, under the Swedish presidency, has pursued work on key files, including the amendment of the Directive on administrative cooperation for tax purposes, the proposals comprised by the “VAT in the Digital Age” package, the revision of the Energy Taxation Directive, the update to the EU list of non-cooperative jurisdictions for tax purposes, as well as the proposal for a Directive to prevent the misuse of shell entities for tax purposes. The draft report includes an update on the progress of these initiatives.

The OECD’s Forum on Tax Administration (FTA) Knowledge Sharing Network held its first virtual meeting last week. The group will gather for a series of meetings where practical advice will be shared, as well as lessons learned on the administrative and implementation aspects of the Two-Pillar Solution.

The transitional implementation of the Carbon Border Adjustment Mechanism (CBAM) will run from 1 October 2023 until the end of 2025. The European Commission has published its first call for feedback on the rules governing the implementation of CBAM during its transitional phase. During the transitional phase, traders will only have to report on the emissions embedded in their imports subject to the mechanism without paying any financial adjustment.

Leaving work to go on holiday can be stressful. Moira Dunne outlines how to prepare effectively so you can really enjoy your break The week before we go on holiday is often the busiest of the year. We become super-productive as we crack through our ‘To Do’ list to clear tasks before we leave. The hard deadline of that final day provides a sharp focus. This helps us stay on track and avoid the usual distractions. I bet you don’t take an extended coffee break on the afternoon before your holiday! Here are three key tips to optimise your last week at work before your holiday. 1. Prioritise, prioritise, prioritise Most people I know have more work to do than they have time to do it. It is important to prioritise every week, but particularly the week before you finish up. Consider the work you have to do and decide: What is important (high priority) and what is nice to have (low priority)? What needs to be done this week, and what can be pushed out? What can be handed over to someone else? The looming deadline of a holiday helps us act more assertively. We can’t say yes to everything as we won’t be at the desk to complete it. So, we negotiate priorities and deadlines because we have no choice. 2. Capture everything In the final days before your holiday, you will be really on top of your workload. Capture everything now so that you get the benefit when you return. Update all your project plans and task lists. This frees your brain to help you switch off quickly. It also helps you get back up to speed when you return refreshed and relaxed from your holiday. 3. Plan the first week back Capitalise on that high-focus period before your break by planning your first days back in the office before you finish up. You may want to ease back into work with a low-key schedule or hit the ground running with some key meetings. Either way, planning ahead will help you switch off during your time off, so you can really rest and recharge. Moira Dunne is a Productivity Consultant and founder of beproductive.ie  

Jean Evans explores how the language women use at work can adversely affect their career prospects and how they can change it The way women use language can sometimes be perceived as undermining their confidence. It’s something women have been conditioned to do and it’s a part of how they communicate. No matter how expert, qualified or senior a woman is in the workplace, the consequences are the same. They are often unaware of the negative impact using self-defeating language can have on their career progression and professional life. Confidence and how women (and men) are perceived is often subliminal and imperceptible. Confident people get promotions, access to projects, support, financing and so much more. So, what happens when a woman is not confident at work? What happens when she undermines herself consistently without even realising it? What happens when her choice of words expresses a lack of self-belief or imposter complex? The result is that she may be turned down for a new job, passed over for a promotion, not given access to projects, or financial support ... the list goes on. Several factors can contribute to this perception: Hedging: Women tend to use more hedging language or qualifiers in their speech, such as “I think”, “maybe” or “sort of” to soften their statements or appear less assertive. This can create an impression of uncertainty or lack of confidence along with a need for validation from others. Apologising: Women often apologise more frequently than men, even when it may not be necessary. Apologising unnecessarily can give the impression that a woman lacks confidence in her opinions or actions. Politeness: Women are often socialised to be more polite and accommodating in their speech. While politeness is generally valued, it can sometimes be perceived as a lack of assertiveness or confidence. Upward inflection: Women sometimes use upward inflection, or ‘uptalk’, at the end of their sentences, making statements sound like questions. This can make them seem as if they are doubting themselves and seeking outward validation. Minimising achievements: Women often downplay their accomplishments or use self-deprecating humour to avoid appearing boastful. While this may be a way to navigate social norms, it can also inadvertently undermine their perceived confidence in their achievements. Minimising the intrusion: This often shows up as “I’m just ...” The word ‘just’ is heavily tied to point 2 in this list – apologising for intruding on someone by email, phone, etc. It’s important to note that these linguistic behaviours are not inherently indicative of a lack of confidence. No matter how expert she may be in her field, any woman may still fall into these linguistics patterns. They can be influenced by societal expectations and unconscious bias. But the fact is that every time this undermining language is used, women lose out. What’s the antidote? Firstly, it’s about women becoming aware of how they speak and write. My advice is that, if you can engage a coach or have a trusted bestie, mention this to them and ask them to highlight any linguistic tendencies that may not be serving you. After a few goes, you will become aware of when you’re doing it and then you can start redefining your speaking habits to back up just how confident and able you actually are. I had a coaching client recently who used the word ‘just’ a lot. I asked her to reread her emails before sending them and to catch herself whenever this word popped up. She texted me back the very next day to say her confidence had shot up exponentially because of this seemingly minor change. She hadn’t even noticed until then how she had been apologising for almost everything! And that was her first step towards a really positive change. Jean Evans is Networking Architect at NetworkMe

Tim Bicknell explores how to unlock the potential of innovation as a positive force for business growth Innovation, that elusive force propelling organisations forward, has become the ultimate strategic imperative in our fast-moving and sometimes chaotic business landscape. But what does it take to forge a culture of innovation? The answer lies, not just in visionary leadership and cutting-edge technology, but also in the delicate and skilled work of transforming teams and businesses into hotbeds of creative brilliance. 1. Leadership as catalyst Leadership commitment is the bedrock upon which a culture of innovation is built. Those at the top of the organisation must prioritise and actively support innovation initiatives, signalling to all the value placed on creativity and smart risk-taking. They must build an environment in which experimentation is encouraged, providing resources and dedicated time for visionary pursuits. Through personal example and unwavering support, leaders can pave the way for a culture that embraces, nourishes and rewards innovative thinking. 2. Rewarding the brave: A culture of risk-taking At the heart of innovation lies the spirit of audacious risk-taking. Organisations must, not only encourage, but also reward those who dare to dream big and venture into uncharted territory. Empowering employees to propose daring ideas, while embracing failure as a stepping-stone to success, creates an environment in which considered risk-taking can thrive. By recognising and incentivising risk-takers, regardless of the outcome, organisations send a clear message that innovative thinking is both cherished and actively encouraged. 3. Fostering cross-functional collaboration Innovation flourishes where cross-functional collaboration is supported. Organisations must shatter the silos that breed stagnation and nurture an environment in which diverse perspectives converge, birthing a breeding ground for creativity and ground-breaking solutions. By creating platforms that encourage individuals from various backgrounds to collaborate, exchange ideas and harness collective expertise, organisations can tap into a wellspring of knowledge and insight, fuelling the innovation process. 4. A learning mindset for continuous growth A culture of innovation thrives on the relentless pursuit of knowledge and growth. Organisations must provide pathways for employees to enhance skills, acquire new knowledge and stay attuned to emerging trends and technologies. Through immersive training programmes, workshops and mentorship, organisations not only arm individuals with the tools for innovation, but also showcase their commitment to personal and professional development. By nurturing a culture of lifelong learning, organisations unleash the creative spirit of their teams, enabling them to adapt and thrive in the face of an ever-changing market landscape. 5. Nurturing a culture of open communication Effective communication and a continuing, open exchange of ideas can support a culture of innovation. Organisations need to construct channels and platforms that foster a seamless flow of ideas across all levels. Regular brainstorming sessions, idea-sharing platforms and innovation forums become the lifeblood of a culture that thrives on open dialogue. Leaders must be seen to be receptive – actively listening to employee suggestions and providing constructive feedback. It is through this culture of open communication and inclusivity that organisations can unlock the creative potential within their teams. 6. Unleashing the power of diversity and inclusion Diversity and inclusion form the bedrock upon which innovation stands tall. Teams comprised of individuals with different skill sets and expertise challenge conventional thinking, leading to fresh ideas and ground-breaking solutions. Organisations must actively seek diversity and foster an inclusive environment in which all voices can be heard and valued. By embracing diverse perspectives, experiences and backgrounds, organisations can effectively foster a culture of innovative brilliance. Cultivating a culture of innovation within a team and business requires a multifaceted approach. Organisations unlock the potential for creative breakthroughs by: prioritising visionary leadership; embracing risk-taking; fostering collaboration and open communication; promoting continuous learning; and nurturing diversity. When these critical success factors are woven into the DNA of an organisation, innovation becomes a driving force, propelling their teams and business towards sustainable growth and success. Tim Bicknell is Managing Director of Deep Cove

Welcome to this week’s Technical Roundup. In developments this week, the World Economic Forum continues its work with the International Sustainability Standards Board (ISSB) by convening a group of sustainability professionals focused on sharing best practices and practicalities of adopting ISSB Standards; the Financial Conduct Authority (FCA) has issued financial promotion rules for cryptoassets and a consultation on guidance on how it approaches, and how firms comply with, FCA requirements that crypto-asset financial promotions must be fair, clear and not misleading. Read more on these and other developments that may be of interest to members below. Financial Reporting The Financial Reporting Council (FRC) has published its thematic review of fair value measurement. This publication reflects the FRC’s Corporate Reporting Review team’s experiences with IFRS 13 and has a particular focus on disclosure matters, with some measurement issues also discussed. The FRC has also published research into the impact of proxy voting advisors and ESG ratings agencies on actions and reporting by FTSE350 companies and investor voting decisions. The IFRS Interpretations committee has issued its June 2023 update which includes details of some of the requests that it has received in relation to; A merger between a parent and its subsidiary (IAS 27) Application of the ‘Own Use’ Exception (IFRS 9) Consolidation of a non-hyperinflationary subsidiary by a hyperinflationary parent (IAS 21 & IAS 29) In order to understand preparer’s views on the International Accounting Standards Board’s (IASB) upcoming Request for Information on the implementation and application of IFRS 15, the UK Endorsement Board is holding some roundtables on 20 and 21 June. Insolvency The Financial Conduct Authority is placing a ban on debt packagers receiving remuneration from debt solution providers. The ban covers any commission, fee or any other financial consideration, received by a debt packager firm, directly or indirectly, from a debt solution provider in connection with the firm referring customers to a debt solution provider, or any other related services.   Sustainability Accountancy Europe is hosting an in-person event on 5 July 2023 at their Brussels offices – CSRD: Striving for Consistent and Quality Sustainability Assurance Engagements across the EU. The European Commission launched a consultation this week seeking feedback in relation to draft delegated regulation supplementing Directive 2013/34/EU as regards sustainability reporting standards. The European Sustainability Reporting Standards (ESRS) in the draft Delegated Act include significant revisions to the draft standards recommended by the European Financial Reporting Advisory Group (EFRAG) in November 2022, which include additional phase-ins, making certain disclosures voluntary, and making all disclosure requirements (apart from a set of general disclosures) subject to materiality assessments. The consultation closes on 7 July 2023. The World Economic Forum continues its work with the International Sustainability Standards Board (ISSB) by convening a group of sustainability professionals focused on sharing best practices and practicalities of adopting ISSB Standards.   Cryptoassets The Financial Conduct Authority in the UK has some recent publications on cryptoassets It released it latest 'Research Note: Cryptoassets consumer research 2023'. The research series began in 2019 to understand the trend in UK adults’ cryptoassets holdings and changes in consumer behaviour and is continued annually to gain further insights into the potential harms and benefits of cryptoassets and understand consumers’ attitudes towards cryptoassets. The FCA says the results from this research will be used to inform its cryptoassets policy work. In the conclusion it is stated that cryptoassets remain a high-risk investment, and anyone who looks to purchase them should be aware of the risks and be prepared to lose all their money. Cryptoassets predominantly sit outside of the FCA’s current regulatory perimeter and users of cryptoassets are unlikely to be covered by financial protections such as the FSCS. In further crypto news the FCA also issued Financial promotion rules for cryptoassets and a consultation on guidance on how it approaches, and how firms comply with, FCA requirements that crypto-asset financial promotions must be fair, clear and not misleading. All cryptoasset firms marketing to UK consumers, including firms based overseas, will need to comply with the UK financial promotions regime from 8 October 2023.  The UK Government is bringing promotions of certain cryptoassets within their remit. The financial promotions regime will apply to all firms marketing cryptoassets to UK consumers regardless of whether the firm is based overseas or what technology is used to make the promotion.   Other News The CCAB-I Business Law Committee submitted a response to the Department of Enterprise, Trade and Employment public consultation on proposed amendments to Companies Act 2014. The response which is available on our website focused on responding to the areas which most impact members from a technical perspective. The Central Bank Deputy Governor spoke recently at the Banking and  Payments Federation Ireland  Retail Banking Conference 2023.The topic was ESG integration in the banking sector. The conclusion was while there is much done, there is much more to do and details of the speech can be accessed here. The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has published its follow-up report to the peer review on the Guidelines on ETFs and other UCITS issues. The report shows that the National Competent Authorities (NCAs) have strengthened their supervisory practices, enhanced internal and external guidance, and performed supervisory work in the area of Exchange-traded funds (ETFs) and other Undertakings for Collective Investment in Transferable Securities (UCITS) since 2018. The Department of Enterprise, Trade and Employment invites expressions of interest from suitably qualified individuals for membership of the Enterprise Digital Advisory Forum (EDAF).  Established in May 2022, the forum plays a key role in advising and working with government to drive industry adoption digital technologies, in accordance with the National AI Strategy and the National Digital Strategy. The UK Financial Intelligence Unit has recently published its latest SARs Reporter Booklet for June 2023 . It provides case study examples highlighting the work of law enforcement agencies in utilising SAR intelligence to initiate investigations and to inform existing ones. The Irish Workplace Relations Commission has, for information purposes published a WRC Remedies Table  (last revised May 31 2023) which sets out the remedies that may be granted by a WRC Adjudication Officer in the different areas of employment and equality legislation which come under the WRC’s jurisdiction. While the WRC states that the table should not be relied upon in place of legal advice and the WRC accepts no liability for reliance on it is a useful summary table for anyone with an interest in employment law. The OECD Guidelines for Multinational Enterprises on Responsible Business Conduct are standards which multinational enterprises are expected to meet, and which OECD member countries have committed to uphold. The Guidelines are recommendations on responsible business conduct and provide non-binding principles and standards in a global context. The 2023 edition of the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct has recently been published and they can be accessed by going to this page where key updates are also summarised. For further technical information and updates please visit the Technical Hub on the Institute website.

Institute President Sinéad Donovan and Tax and Public Policy Lead Cróna Clohisey represented Chartered Accountants Ireland at the National Economic Dialogue (NED) 2023 last week. The NED provides a forum for public consultation and debate ahead of Budget 2024 and this year’s theme was The economy in 2030: enabling a sustainable future for all. The discussion centred on the need to move the focus of economic dialogue towards more medium-term issues, with much debate around whether to spend or save the projected economic surplus. The need to accelerate housing supply, protect living standards and continue to invest in public services, all against the back-drop of managing inflation, formed part of many of the contributions. Institute representatives emphasised to Ministers the importance of addressing capacity building within the economy, particularly in housing and set out suggestions around using the tax system to boost supply. Documents and speeches from the NED can be found on gov.ie.

In this week’s EU exit bulletin, we bring you the latest guidance updates and publications relevant to EU exit and we update you on recent developments in relation to the Retained EU Law Bill. The latest Trader Support Service and Borders Weekly Stakeholder Bulletins from 2 June and 9 June are available and we provide a further update on the Windsor Framework. It is also confirmed that the long awaited duty reimbursement scheme will open for claims from the end of this month. Retained EU Law Bill At the end of May, the House of Commons considered the House of Lords amendments to the Retained EU Law Bill (Official Report part 1, and Official Report part 2). Parliament returned from a short recess on 5 June which was followed by Kemi Badenoch, the Minister responsible for the Retained EU Law Bill, appearing before the European Scrutiny Committee on 6 June. The House of Lords is  due to consider the House of Commons amendments to the Bill next Tuesday 20 June and the European Scrutiny Committee has published its report on the Windsor Framework. Miscellaneous updated guidance etc. The latest guidance updates, and publications relevant to EU exit are as follows:- Check simplified procedure value rates for fresh fruit and vegetables; CDS Declaration Completion Instructions for Imports; Tell HMRC if you still need your EORI number starting XI; Search the register of customs agents and fast parcel operators; Appendix 2: DE 1/11: Additional Procedure Codes of the Customs Declaration Service (CDS); Search the register of customs agents and fast parcel operators; Check simplified procedure value rates for fresh fruit and vegetables; Search the register of customs agents and fast parcel operators; and Reference Documents for The Customs Tariff (Preferential Trade Arrangements) (EU Exit) Regulations 2020.

Introduction: Artificial intelligence (AI) has emerged as a transformative technology across various industries, and the field of accounting is no exception. Small to medium-sized accounting firms are beginning to recognise the potential of AI in streamlining their operations, enhancing efficiency, and improving client services.  This article delves into the ways in which AI is poised to revolutionise the landscape for these firms. Automating Mundane Tasks: One of the significant advantages of AI for small to medium accounting firms is its ability to automate mundane and repetitive tasks.  AI-powered software can efficiently handle tasks such as data entry, reconciliations, and invoice processing, which previously required considerable time and effort from accountants.  By automating these tasks, accountants can focus on more strategic and value-added activities, such as financial analysis and advisory services. Enhanced Data Accuracy and Compliance: Accuracy is paramount in accounting, and AI can significantly contribute to ensuring error-free operations.  AI algorithms can analyse large volumes of financial data quickly and accurately, minimising the risk of human error.  This leads to more reliable financial reporting, improved compliance with regulations, and reduced auditing costs for small to medium accounting firms. Improved Decision-Making: AI-powered analytics can provide accountants with valuable insights by identifying patterns and trends in financial data.  This enables them to make data-driven decisions and offer strategic advice to clients.  AI algorithms can also assist in forecasting future financial outcomes, helping small to medium firms better plan and optimise their financial strategies. Enhanced Client Experience: AI-driven chatbots and virtual assistants can revolutionize client interactions for small to medium accounting firms.  These AI-powered tools can handle routine client queries, provide real-time support, and even offer personalised financial advice.  By automating customer service, accountants can focus on building stronger client relationships and providing more specialized services. The Human Touch What are your thoughts on this article so far?  Everything up to now was written by Chat GPT! I asked it to write a 300 word article on the impact of AI on small and medium accounting firms and this is what it wrote in less than a minute.  I removed the machine’s conclusion because I will take up the story now. The article so far may be a bit generic, but it is accurate, readable, and if follows a logical sequence.  This development should give us all pause for thought.  Clearly this has to potential to effect profound changes to how we do our work, but we are all still trying to peer into the future and guess exactly how this will happen.  One can ask is this the future, where does the human element fit into the ever-evolving developments of AI.  Here are some further (human generated!) reflections on how AI will impact small to medium sized accountancy firms over the next number of years.  Chat GPT is the latest buzz word in the media over the last few months.  However, it could be described as just a tree in the huge AI forest.  AI has been around for several years; many of us remember when “Deep Blue” (IBM’s supercomputer) beat the world chess champion Garry Kasparov way back in 1996.  However in more recent times, AI has been quietly changing the way that we do bookkeeping tasks, making suggestions for where to post and how to code invoices and payments, and automatically reconciling bank accounts.  Most accountants will agree that AI will contribute to savings, reduce errors and aid compliance.  This is turn will free up accountants, resulting in accountants getting to spend more time assisting clients to run their business rather than focusing on data entry and repetitive tasks. Of course, there are risks and downsides.  Firstly the use of generic AI packages may compromise client data.  For example you should never input confidential or personal data to Chat GPT, which is not a secure platform.  And of course, AI can get it wrong.  Occasionally it will generate answers that appear logical, and may even be backed up by references which are spurious; this is known as hallucinating and it can be difficult to spot. The opportunities for training of junior staff may be reduced as AI can readily take over simpler tasks. There are also ethical risks.  AI may enable people to pretend to have knowledge and insights that they do not have.  This can result in poor advice given to clients, and in extreme cases it facilitates fraud.  Many firms are already investing in AI and there is a premium in being able to respond quickly to technological changes and to grasp opportunities.  Consider how you will find the right of mix of AI products and capabilities, and choose what you want to build, buy or partner.  This is coming at a time when the recruitment market for accountants and book-keepers is getting continuously tighter. Is AI the solution, or part of the solution, to the never-ending staff crisis? Time will tell. Here are some areas where we think we may see practical changes.  Firstly the tasks of writing reports, letters, summarising reports, and creating presentations are greatly facilitated.  Like the first part of the article above, Chat GPT or similar applications will create a first draft of these almost instantaneously.  Where you are struggling for words, try asking it to “write this more professionally for me”, and enter your own text to see what it suggests.  These capabilities are available now, and for free.  However, remember the previous warning about not entering confidential information to ChatGPT. We understand that Microsoft is currently rolling out an AI add-in called Co-Pilot which they say will ultimately be available to all Microsoft 365 users.  The premise is that you will be able to, say, ask Co-Pilot how you should prepare for your upcoming meeting and it will create an agenda and content for you based on your current activity.  And of course Co-Pilot should know how to use all the features in all the Microsoft apps that you never use!  No doubt, Microsoft’s competitors will produce rival solutions.  There are a number of plug ins available for standard spreadsheet programs that will analyse data and write natural language reports on your data.  The idea is that you can ask the program, for example, to analyse results for the past three years, identify key trends and draft a graph to illustrate this. Tax compliance is another area where the technology seems to be progressing quickly.  Current developments point to software that will review your tax client portfolio and suggest where you may have overlooked available tax reliefs and credits and draft the relevant correspondence to Revenue.  We await the outcome of these developments here with interest. Audit is another area where the opportunities to carry out large scale reviews of data and generate documentation should transform processes over time. Of course, the difficulty with trying to anticipate future technological changes is that it is not clear what problems are readily solvable until after they are solved.  Like the self-driving functions on high end cars, the advice is to use the technology to help you, but keep your hands on the steering wheel for now!  Always proceed with caution, and do a common-sense check on anything that you produce using AI.  In the meantime, stay alert for the opportunities that these technologies can create for you practice. The human part of the above article was written by Maria Moloney FCA, who has joined Practice Consulting as a consultant.

On 29 May, we updated you on key messages from a recent meeting with the Northern Ireland Joint Customs Consultative Committee on the Windsor Framework (“WF”). Today we provide more details on the matters discussed including NI-GB unfettered access, more on both the UK Internal Market Scheme and the Reimbursement Scheme, news about the treatment of mixed loads, and an update on XI EORI numbers. HMRC has since updated a number of publications which are referenced below. Unfettered NI-GB access Officials confirmed that there will be no changes to goods movements from NI-GB, hence unfettered access will continue to be available and protected with, as it is currently, no export requirements needed other than for exceptional goods such as endangered species, hazardous chemicals, etc. UK Internal Market Scheme (“UK IMS”) It is confirmed that the new UK IMS, which will replace the UK Trusted Trader Scheme (“UK TTS”) from 1 October 2023, will include a higher commercial processing threshold and broader sectoral exemptions. As the scope of UK IMS is wider than the current UK TTS, there will be some additional authorisation requirements. In addition to company directors, HMRC will check whether senior employees responsible for the movement of goods under the scheme have any serious criminal offences recorded in relation to economic crime. There will also be more detailed questions on record keeping and internal controls. HMRC will also undertake checks to ensure that traders are “of good financial standing.” HMRC will also provide new guidance on obligations when moving goods under the scheme with traders required to sign a declaration to confirm they have read and understood the guidance, and that they understand their obligations under the scheme. Traders currently holding authorisation under the UK TSS will be contacted by HMRC in order for re-authorisation to commence for the UK IMS and will need to login using their Government Gateway to complete enrolment onto the UK IMS. This should be done within six weeks of receiving contact from HMRC about re-authorisation, to ensure UK IMS enrolment before 30 September 2023. The new UK IMS is now open to apply for authorisation.  The reimbursement scheme The reimbursement scheme will allow for reimbursement of tariffs paid on goods classed as being at risk which later become/became not at risk under the original Protocol and on goods which move in the new red lane which should originally have been green lane movements under the WF. This includes the following scenarios:- Final sale of goods takes place in NI; Goods are consumed in NI; Goods are destroyed in NI; Goods are moved back to GB from NI; and Goods exported to RoW (Rest of World). In order to claim, the trader must gather evidence to support the claim and submit this to HMRC where a caseworker will consider the application. Mixed loads It was confirmed that mixed loads (green and red lane movements in the same container) will be possible under the WF, however red lane goods within mixed loads will be subject to full customs and SPS checks, hence this will slow down such movements. Miscellaneous A number of questions were taken away for more detailed consideration including the treatment of different goods movements such as EU/Ireland-NI-GB, NI-Ireland-GB and GB-NI-EU/Ireland. We will share the responses to all queries when available. A query was also raised in respect of how goods movements under the WF interact with the proposed Border Trade Operating Model. Post and parcel movements (C2C, B2C, B2B) are to be covered in a separate meeting but will not switch on until 1 October 2024 and new quotas are in place for categories 7 and 17 of UK steel. XI EORI number HMRC has recently written to businesses with a GB registered business address who hold an XI EORI number to confirm if they have a permanent business establishment (“PBE”) in NI or if they still need their XI EORI number for the limited customs purposes for which this is provided. Businesses meeting the criteria to retain their XI EORI number for the limited list of other customs purposes do not have to be established in NI. This validation exercise letter invites traders to upload evidence of a PBE in NI or to select on the G-form that they meet the criteria to retain their XI EORI number. Updated guidance and publications HMRC has also published and updated a number of guidance documents as follows:- The Windsor Framework - further detail and publications; How to make sure the correct duty is applied to goods you bring into Northern Ireland from countries outside of the EU and UK; Sign up for the Trader Support Service; Declare goods using the UK Trader Scheme if you bring goods into Northern Ireland; Check if you can bring your goods into Northern Ireland from Great Britain without paying duty; and Declaring goods you bring into Northern Ireland 'not at risk’ of moving to the EU.  

From today, Monday 12 June, until 4 September 2023, HMRC is closing its self-assessment helpline. This decision was notified to Chartered Accountants Ireland in a meeting just one day before the official announcement last week and was not consulted on in advance. The decision was embargoed until the official announcement on Thursday 8 June. We would be keen to hear your feedback on the impact of this decision. Note that this does not affect self-assessment queries on the Agent Dedicated Line which we understand was restored to full status again from 2 June. This week’s News and Information from HMRC also covers the closure of the helpline. The decision to close the helpline is clearly as a result of ongoing pressures on HMRC’s services due to resource constraints and limited and falling real time budgets. The Institute is highlighting the continued impact this is having on agents and taxpayers and makes several recommendations to the UK Government in the 2023 Next Financial Year position paper which will be published later this week. In the meeting during which HMRC notified the Professional Bodies of this closure, a number of questions were asked the answers to which are reproduced below. “If someone needs to withdraw a return how can they do this with no phone line? Almost any task that can be actioned or query that can be resolved on the phone, can also be sorted via webchat. This includes withdrawing a Self-Assessment (“SA”) return.  We advise customers to use our ‘Ask HMRC online’ digital assistant. If your query can’t be dealt with this way, you will be put through to our webchat service. If you need to file then how can you do this? You can file online – just like the 97% of SA customers who already use HMRC’s online services to file. Almost every query that can be resolved on the phone, can also be done via webchat. Anyone who needs extra support if their health condition or personal circumstances make it difficult for them to contact HMRC, can get support from our Extra Support team.  Otherwise, the helpline will re-open on 4 September this year so customers can receive expert support in the five months running up to the SA deadline on 31 January 2024. What if someone actually needs to speak to us? Any customers with an urgent SA query will be able to get support through our digital assistant, and where appropriate they may be routed to our SA webchat facility or a technical expert, for example, if the customer is in financial distress.  If customers are digitally excluded or qualify for extra support, we’ll ask our colleagues who respond to webchat, to refer them to our Extra Support Team following their usual processes.  What is the plan B if customers can’t speak to HMRC? Almost any task that can be actioned or query that can be resolved on the phone, can also be sorted via webchat. We advise customers to use our ‘Ask HMRC online’ digital assistant. If your query can’t be dealt with this way, you will be put through to our webchat service. We recognise that some agents may have to deal with more contact from their clients as a result of this change. However, we encourage agents to let their clients know that anyone with complex queries that they need additional help resolving, should use our ‘Ask HMRC online’ digital assistant. If their query can’t be dealt with this way, they will be put through to our webchat service. Almost any task that can be actioned or query that can be resolved on the phone, can also be sorted via webchat. How are the digitally excluded going to be supported? How do they access the Extra Support Team if not through the SA helpline? Anyone who needs extra support if their health condition or personal circumstances make it difficult for them to contact HMRC, can get support from our Extra Support team.  If customers need extra support, they can get a phone or video appointment with the extra support team. Ask your advisor when you call any HMRC helpline or use the extra support team webchat service. Are there plans to close the ADL line? The Agent Dedicated Line (ADL) is unaffected by this change, so agents can still call us during this period. The ADL opening hours are Monday to Friday: 8am to 6pm. There are no current plans to make any further changes to the opening times. Will we stop putting out comms about filing early if there is no support available? Our Early Filing campaign will begin on 4 September when the phoneline reopens. However, we will continue to encourage customers to file early and online. If customers have any complex queries that they need additional help resolving, we would recommend they use our ‘Ask HMRC online’ digital assistant. If their query can’t be dealt with this way, they will be put through to our webchat service. Almost any task that can be actioned or query that can be resolved on the phone, can also be sorted via webchat.”

From 1 May 2023, the new VAT related payment scheme for certain second-hand cars came into operation. HMRC has recently updated guidance for the scheme which now provides guidance for EU businesses on how to claim a payment if they do not have a business establishment in the UK. EU businesses can make their claim directly to HMRC from 1 August. They can prepare to make their first claim by:- appointing someone to deal with a claim on their behalf; or requesting access to the HMRC Secure Data Exchange Service to submit a claim electronically. The guidance pages relevant to this are as follows:- How to claim a VAT-related payment using the second-hand motor vehicle payment scheme if you do not have a business establishment in the UK; Submit a claim using the second-hand motor vehicle payment scheme if you do not have a UK business establishment; and Appoint someone to deal with VAT-related payments using the second-hand motor vehicle payment scheme. Other guidance pages relevant to the scheme are:- Check which records to keep for second-hand vehicles you export to the EU for resale; Sales of second-hand motor vehicles in Northern Ireland; Claim a VAT-related payment if you buy second-hand motor vehicles in Great Britain and export them to the EU for resale; Check which records to keep for second-hand vehicles you move to Northern Ireland for resale; and Claim a VAT-related payment if you buy second-hand motor vehicles in Great Britain and move them to Northern Ireland for resale.

The Institute recently responded to the consultations Expanding the cash basis and Simplifying and modernising HMRC’s income tax services. Both submission responses are available to read in the Tax Representation section of our website. Key points from each are set out below. The Department of Finance has also published a factual summary report of responses to the “Consultation on devolution of more fiscal powers” launched late in 2022 by the then Finance Minister. Chartered Accountants Ireland’s response to that consultation is available to read on our website. The report will help inform any incoming Finance Minister’s considerations regarding further fiscal devolution, and it would then be for a future Executive to consider any potential recommendations. Expanding the cash basis The following key points and recommendations are made in the Institute’s response to this consultation:- The cash basis should remain as opt-in only. The turnover limit should be aligned with the thresholds used for the VAT cash accounting scheme, which should also be uprated. The rules for vehicles in the cash basis should be reformed and simplified. A review of the simplified expenses regime should be undertaken, and their rates uprated. A number of recommendations are made to improve the self-assessment form in order to both raise awareness of the cash basis and minimise the impact of businesses moving between the cash basis and the accruals basis. The exclusion for business premises renovation allowance and claims for research and development allowance should be removed. A number of the current restrictions should be removed including the restriction on sideways loss relief and relief for interest costs. The cap on certain income tax reliefs needs to be uprated. The additional income tax and Class 4 NIC as a result of the transitional adjustments should be spread over a number of tax years via an election. A number of recommendations are made to lessen tax complexity. The Office of Tax Simplification’s (“OTS”) recommendations on tax education tools/learning should be included in the Tax Administration Strategy and HMRC should explore the potential to provide basic tax information or training to young people on entering the workforce. Simplifying and modernising HMRC’s income tax services Key points and recommendations are as follows:- HMRC should seek additional investment for the final two tax years of the current spending review period to ensure that current service levels do not further deteriorate and to support the introduction of new digital services. HMRC should focus on its current objectives for simplifying income tax services before considering more radical reform. A number of recommendations are also made to lessen tax complexity. Taxpayers should be able to opt out of the “digital by default” approach. HMRC’s current transformation project should include the development of a secure email communication channel for taxpayers and agents.   HMRC must develop, implement, and maintain online services and contact routes specifically for agents. A facility for agents to access their clients’ data should be included in the development of new online services. Agent services for taxpayer registration should also be developed in tandem with the development of any online taxpayer registration system. HMRC should examine the root cause of the ongoing high levels of amendments needed to PAYE codes and a review should be conducted of how RTI data could be used more effectively by HMRC. The March 2022 recommends of the OTS in its “Evaluation paper on improvements to the operation of the PAYE system” should also be considered by HMRC. Tax refunds for employees should not be processed into their employer’s payroll bank account and HMRC should consider how a similar system for PAYE could be implemented in the UK like the system currently available to taxpayers in Ireland. A roadmap should be published setting out how the digitally excluded will be catered for. Any new services must contain the necessary safeguards to protecting sensitive taxpayer data. A number of suggestions are made to improve the current ITSA criteria and codifying in legislation should be avoided. HMRC should consider how tax guidance principles can be developed outside Government Digital Service constraints and the recommendations made by the Low Income Tax Reform Group in its report on guidance should also be reviewed and considered for implementation. HMRC will need to embark on an education and communication campaign to communicate any new online services to taxpayers and agents. Several recommendations are also made to improve taxpayer education and awareness of the UK tax system. A full roadmap for the future delivery of the Tax Administration Strategy needs to be published.

HMRC has recently updated its Check when you can expect a reply from HMRC tool. This can now be used to check when you should receive a reply to certain types of requests about PAYE for employers, national insurance contributions issues, including registering a PAYE scheme and claiming a Construction Industry scheme refund. HMRC advises that the Where’s my reply tool and/or the HMRC service dashboard should be consulted for the expected response date before any progress chasing calls are made.

In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit and we update you on recent developments in relation to the Retained EU Law Bill. The latest Trader Support Service and Borders Weekly Stakeholder Bulletins from 2 June and 9 June are available and see part 2 of our story on the Windsor Framework. Retained EU Law Bill At the end of May, the House of Commons considered the House of Lords amendments to the Retained EU Law Bill (Official Report part 1, and Official Report part 2). Parliament returned from a short recess on 5 June which was followed by Kemi Badenoch, the Minister responsible for the Retained EU Law Bill, appearing before the European Scrutiny Committee on 6 June. The House of Lords is to consider the House of Commons amendments to the Bill and the European Scrutiny Committee has published its report on the Windsor Framework. Miscellaneous updated guidance etc. The latest guidance updates, and publications relevant to EU exit are as follows:- Check simplified procedure value rates for fresh fruit and vegetables; CDS Declaration Completion Instructions for Imports; Tell HMRC if you still need your EORI number starting XI; Search the register of customs agents and fast parcel operators; Appendix 2: DE 1/11: Additional Procedure Codes of the Customs Declaration Service (CDS); Search the register of customs agents and fast parcel operators; Check simplified procedure value rates for fresh fruit and vegetables; Search the register of customs agents and fast parcel operators; and Reference Documents for The Customs Tariff (Preferential Trade Arrangements) (EU Exit) Regulations 2020.

HMRC’s latest schedule of live and recorded webinars is now available for booking. Spaces are limited, so take a look now and save your place. The Agent Forum – working with the agent community: book now This live webinar aims to raise awareness of the Agent Forum (“AF”) and will look at:- the benefits of using the AF; proper use of the AF, including what HMRC expects from agents and what to expect from HMRC; good practice; and useful hints and tips. A recording is also available to register to view of the webinar UK freeports – examples of tax and customs benefit.

Do you use HMRC online services? Don’t be caught out by the planned downtime to some services. HMRC are warning about the non-availability of specific services on the HMRC website, a range of services are impacted. Check the relevant page for information on planned downtime. Two new services have recently been added to this. The status of the income tax self-assessment payment plan page can now be checked as can the employers PAYE payment plan page.