Tax and Customs Declaration Service Under Threat

Concerns over the UK’s Big IT Projects

‘Making Tax Digital’ and ‘Customs Declaration Service’, HMRC’s flagship programmes along with some other IT projects are under threat. According to the Annual report by the Infrastructure Projects Authority (IPA), nine government (ICT) projects are raising doubts about their successful delivery due to the high risks associated with some of their aspects or areas. 

What do you need to know about ‘Making Tax Digital’?

‘Making Tax Digital’ is one of the game-changing initiatives by HMRC, to help businesses get their tax right. Moreover, The design help them stay on top of their finances. The aim was to make the tax system more efficient, reliable, and simple for businesses that are struggling to get their tax right.

Making Tax Digital- Deadline extended

According to the programme, businesses generating taxable profits that go above the VAT threshold will have to use this service in order to store their records digitally. Not just that they can use it to submit their VAT returns through an MTD compliant software. If you are still unsure of the process of MTD, speaking to a VAT accountant will help.

What do you need to know about ‘Customs declaration service’?

HMRC introduced a Customs declaration service to replace the current ‘Customs Handling of Import and Export Freight (CHIEF) system over a period of three phases between August 2018 and the beginning of 2019.

Moreover, the aim of CDS is to revolutionise the existing system of customs declaration for importers and exporters, whenever they are trading outside the European Union (EU). If you are an Import and Export Business, you should speak to an Accounting firm to remain compliant.

What are the highlights of the Infrastructure and Projects Authority’s (IPA) report?

The report has flagged the projects that are amber-red. Furthermore, The report highlights the Cabinet Office’s ‘Digital Identity Project’ as the only project that the watchdogs have marked red.

27 out of 133 government projects are under the category of Information and communication technology (ICT) projects. Collectively, theyare  worth about 10 billion. The other 106 projects fall under different categories with most of them having considerable digital characteristics as well. 

38 out of 133 have been flagged as amber-red, 66 flagged as amber and 18 have been rated as amber-green. Amber means that the delivery seems possible but there are genuine issues to resolve. Amber-green means the probability of successful delivery of the project, considering its time, budget, and quality, is very high.

Why were ‘Making Tax Digital’ and ‘Customs Declaration Service’ flagged as amber-red?

As the report suggests, ‘Making Tax Digital’ was flagged as amber-red last year. It happened due to issues and doubts that were arising due to the challenges in delivering the correct functionality. However, other concerns were regarding planning in parallel for VAT accounting in case of Brexit without any deal.

‘Customs declaration service’ faced IT related issues due to which it has also been flagged as amber-red. CDS aims to replace the Customs Handling of Import and Export Freight (CHIEF). This came in response to the issues that have been repeatedly raised because of the deadline imposed by Brexit.

• Making Tax Digital- Deadline extended
• Brexit Transitioning Period: Get Ready as Deadline Looms

Other ICT projects flagged as amber-red

Following is the list of the other ICT projects that have been flagged as amber/red.

1. The Home office’s METIS programme
2. The DHSC’s Health and Social Care Network programme
3. The DHSC’s IT Infrastructure Sourcing Programme.
4. The MOD’s New Style of Information Technology (base) programme
5. The MOD’s Future Beyond Line of Sight programme
6. The Home Office’s National Law Enforcement Data programme

Even though these programmes are at the risk of failing, you still have to stay compliant to HMRC’s demand. It is therefore advisable to find an accountant who can help you with compliance and the required growth solutions.

Clear House Accountants are specialist Accountants for company in London who have made sure that all their accountants are trained and developed to the highest standards while maintaining their CPD requirements as chartered accountants.