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MAKING TAX DIGITAL (MTD)
An accountants view of Making Tax Digital software
As an accountant, you have a responsibility to make sure your clients are ready for the Making Tax Digital (MTD) changes, and that their processes and software are fully compliant by April 2022. But we know that different clients have different needs, and there are plenty of accounting software packages available for them to choose from.
We talked to Paul Crichton, Managing Partner of accountancy firm MMG Archbold, to find out how his firm uses QuickBooks and what they’ve done to get clients ready for MTD.
There’s a lot of buzz around MTD. What are your thoughts on it?
A lot of people might be nervous about MTD, because it’s new and unknown. But I think it’s a good thing – it will bring down the cost of compliance for the entire country. Plus, we’ll see a shift in the bookkeeping mindset – everything will become more organised.
When you break it down, Making Tax Digital is just a software update. It’s a different, more efficient way of putting the numbers in the boxes by harnessing bank feeds, bank rules, data automation. MTD looks at all these systems and answers the question, “How efficient can we make this?”
How did your firm prepare for MTD?
We have quite a few staff, and they all needed to know how to use the new MTD compliant software. So we reached out to QuickBooks for help. QuickBooks support around MTD has been fantastic. Honestly, it’s been second-to-none. I don’t think I could ask for more.
All our staff have had core QuickBooks training, and 70% of them have had the advanced training. They should all be able to answer clients’ questions.
What are the biggest challenges you’ve faced preparing for MTD?
Organising to get all our staff trained was time-consuming. It wasn’t that the training itself was challenging, but we changed from the old system to the new one, and our staff had to learn as they went. But we’re over the hurdle now.
We also had to on-board all 900 of our clients. It’s been a lot of work, but it’s been worth it.
How did you prepare your clients for MTD?
Despite MTD being all over the financial press, it’s surprising how ignorant most clients were about it. Our firm made flyers and newsletters about MTD, so we thought they would be familiar with it. We found that wasn’t the case.
Not all of our clients needed to comply in April 2019. But while we didn’t have to get all of them ready at the same time, we tried to migrate everyone to the new software ahead of the curve. That way, when a client’s compliance date comes, it’s just an event – not a bang.
We have some larger clients on SAP who said they’ve got bigger things to deal with now. They’ll probably be the ones who get into the weeds now the MTD changes have hit. But we’ll be there to guide them through it.
Do you have any success stories of clients you’ve migrated?
We help St Johnstone FC, a local football club, with their accounts. We looked at the software they were using. It probably could have done the job, but it was very clunky and beyond what they needed. Moving them to QuickBooks wasn’t so much for MTD, albeit it made them compliant. It was more about getting their overall reporting and systems updated and more efficient.
Efficiency gains have been substantial. Whereas before they thought they needed an accountant plus other support staff, they’re now down to one accountant who is able to do the job efficiently alone.
It has been very successful for them. It’s a sizeable business turning over £4 million on QuickBooks Online. A lot of people seem to think QuickBooks is only for small businesses, but it’s not. We use QuickBooks ourselves.
What QuickBooks features do you value the most?
I like how we can set up apps to speak with QuickBooks and make everything even more efficient. But it’s not the features that are the best thing, in my opinion.
QuickBooks came in and trained our staff personally. And our Business Development managers, Philippa and Frank, are in regular contact with us. For me, it’s more to do with the people. The Making Tax Digital software is just software. It’s the people and the support team that have been invaluable. That’s what makes the difference.
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