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UK Professional Bodies Cautious Over E-Filing

by Jason Gorringe, Tax-News.com, London

01 August 2008

The professional bodies which are part of the Working Together E-Group have welcomed HM Revenue & Customs’s (HMRC) current review of their online tax return filing system, the Chartered Institute of Taxation (CIOT) has announced.

However, members of the bodies who responded to a survey this month have indicated overwhelmingly that free online filing software should continue to be made available to all unrepresented individual taxpayers and to smaller employers and businesses.

The group, which regularly meets with HMRC to discuss issues regarding online filing, polled its members over the future of the online filing system.

Nearly 500 practitioners, who between them deal with an estimated quarter of a million tax returns, completed the survey.

Paul Aplin of the E-Group, Chairman of the ICAEW’s Tax Faculty commented:

"82% of members responding thought that HMRC should continue to supply free software to unrepresented taxpayers. This is on the basis that if HMRC want to encourage individuals to file online rather than by paper, HMRC should continue to supply a free basic e-filing service."

Those responding predominantly pay for their own software but were concerned that those not represented by agents should be looked after.

In particular, 87% of respondents indicated that employers with less than 10 employees should continue to receive free software, to help minimise the burdens of being an employer and enable them to continue to act as agents for HMRC in operating PAYE and NICs.

The survey also addressed the current state of the e-filing system.

"At a time when HMRC are investing in improving the online system we were very disappointed to find that 85% of respondents said that the system was worse or no better than last year. Only 15% thought the system had improved – seemingly a marked deterioration since last year when a majority of CIOT members surveyed reported an improvement" explained Tina Riches of the E-Group, Technical Director (Cross-Cutting) of the Chartered Institute of Taxation.

According to CIOT, the survey results indicate that HMRC need to think very carefully before any strategic changes and also need to carry out extensive testing before requiring changes to their own and commercial e-filing system software.

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