At the Taking Tax Digital Conference 2020 on 5 November the following members of the Tax Systems senior management team delivered insights into how the company is adapting to meet current and future challenges:
- Russell Gammon, CINO – Alphatax in the Cloud
- Ines Liberato – Innovation at Tax Systems
- Rob Ogilvie – Finance Act 2020 and Beyond
- David Tinker – How customers are saving time/creating efficiencies
Kicking off the team presentations was Russell Gammon, Chief Innovation Officer at Tax Systems, who began by saying that while technology has been essential to the resilience of organisations during the pandemic, it’s also revealed where processes can be improved. He went on to explain how, following extensive market research four key areas were identified for improvement which have formed the foundation of “Project 21”, a major initiative that will see the development of a holistic cloud-based tax platform.
Firstly, he found that within tax processes, not only was the transposition of data from source to report inefficient, but also the communication process that surrounds the “data journey” lacked a consistent approach. His team also found that processes were risk prone due to key person dependencies, transposition errors etc, and that in order to address this we need more accountable ways of working. Adopting HMRC’s digital links concept “as a way of working” could ensure that the business was able to “show its workings” by virtue of a digital audit trail, effectively acting as a form of due diligence.
Thirdly, Gammon found that data was not being utilised elsewhere, conferring limited business insight, and that in order to leverage this analytics software should be used in a tax context. This would bring the data to life and allow it to be interrogated, even allowing the user to ask ad hoc questions. Finally, he concluded that high value employees were often spending their time on low value tasks, and said the idea was not to remove them from the process but to elevate them and maximise their expertise by automating processes to the point of review.
The development cycle
Inês Liberato, Head of Product Innovation at Tax Systems, explained how the team worked to develop a holistic solution. She gave the example of e-filing, saying this typically involves a lot of steps, documentation is all over the place and there are challenges with group filing.
To tackle this problem, the team is reducing the number of steps by exploring how online retailers streamline their processes; for example, how basic information is auto-filed, and document management has a more contextual approach to it. A level of permissions has been added and they’re looking at how to enable group filing to increase efficiency.
Liberato concluded by saying customer feedback is a vital part of the process, helping the team to identify and prioritise issues, and urged attendees to reach out to her team via firstname.lastname@example.org with any queries or suggestions.
Alphatax today and tomorrow
Alphatax v20.0 has been updated to accommodate a number of legislative changes. Robin Ogilvie, Head of UK Tax Development, gave an overview of the recently introduced Corporate Capital Loss Restriction (CCLR) before explaining how changes under Finance Act 2020 were being accommodated including corporation tax being held at 19%, research and development expenditure credits (RDEC) increasing to 13% and the structures and buildings allowance increasing to 3%. Changes under tax returns covered the 2020 versions of the CT600, SA700 and SA800. New features added to Alphatax included a capitalised revenue expenditure statement, a group losses summary statement and various other enhancements and fixes. Robin also drew attention to the autumn patch release – v20.0.4 – which incorporates CCLR additional points.
The next version of Alphatax will be released in mid-January. V20.1 will have no legislative changes but will include the 2021 version of the CT600 featuring new boxes for incorrectly claimed CJRS/Job retention bonus and a new CT600L for RDEC. Other enhancements will include Patent Box 2021 transition, an investments in subsidiaries statement, further changes in response to IFRS16 and how it feeds into CIR, and tax accounting enhancements in company and group.
There are two submission changes of note coming in 2021. The first is the CT600L (a supplementary page for corporation tax) for RDEC. This must be completed for any new or amended RDEC claims submitted from 6 April 2021 onwards. The new supplementary page presents details of the 7 step calculation under s104N, and proves boxes 530 and 880 on the CT600. The existing statement in Alphatax already largely follows this format.
The second is a new electronic submission mechanism for the CIR interest restriction return. HMRC have published draft APIs and a testing service is being made available for software developers from the end of this year. The information included is largely the same as the existing return. HMRC have said that they intend this to become mandatory, but importantly there is presently no timescale for mandation. We intend to introduce support for this submission process during 2021.
Alphatax life hacks
Alphatax features a number of functions that can significantly improve workflow leading David Tinker, Professional Services Manager for Tax Systems, to outline his three top tips for saving time and creating efficiency using the software.
- Accounts analysis – standardised template that offers better reconciliation to the statutory accounts, thereby reducing review time
- Group module – speeds up consolidation process. This consumes data from entity files and consolidates it into reports. It’s favoured for its group matrix representation but did you know this auto populating function makes it a great reporting tool?
- Accounts integration – automated data import focuses attention on tax analysis. Allows submissions to be made confidently in advance of the deadline. Imports a direct trial balance into Alphatax, freeing up time from keying in data, making it a proven tool in reducing workload.
Tinker went on to say that the most common queries they’ve had via the support centre concern either losses or technical queries about working from home. He sadly conceded that losses are more prevalent now due to the recession but cautioned that tax managers need to make sure they are familiar with the rules which are now more complex and to utilise the help function within Alphatax to assist them. Those working from home need to ensure they are using the latest version of Alphatax and have the correct access credentials to ensure they can file before their deadline.
To conclude, the Tax Systems team would welcome any questions or feedback you may have via email@example.com and please do continue to make use of our dedicated support team who are here to assist you via firstname.lastname@example.org. If you would like to listen to some of the above conference sessions, please visit our YouTube channel here.