Software needs to work for you, your accountant and HMRC

Making Tax Digital is a big change for everyone. The challenge is to find a solution that works for everyone – 𝘆𝗼𝘂 (as the business owner), 𝘆𝗼𝘂𝗿 𝗮𝗰𝗰𝗼𝘂𝗻𝘁𝗮𝗻𝘁 and 𝗛𝗠𝗥𝗖.

I read a post recently about how accountants need to be looking for efficiencies in Making Tax Digital (MTD) by streamlining processes and making use of AI. It’s not the first time I’ve seen the suggestion that the best way for accountants to streamline processes is to get all their clients to use the same software.

Whilst I can see the logic, the suggestion also worries me – because, for a change of software to be successful, it needs to be done with the consent and emotional buy-in of the individual.

Another post last week talked about self-employed individuals holding their ground and using whatever software suits them, even if their accountant doesn’t like it. Another worrying point of view. Yes, the software needs to suit the individual, but it needs to suit the accountant and HMRC too.

Both approaches are flawed. Software choices aren’t black and white – any more than life is.

A few years ago, I took on a new bookkeeping review client. He had been doing his own bookkeeping quite happily in a different software package, and then his accountant moved him to Xero. He hadn’t argued. After all, his accountant must know best. Except they moved his books across and left him to it.

Fast-forward a year, to one stressed client and bookkeeping that needed significant sorting out because the client hadn’t been trained on how to use the new software.

Another client came to me, who was perfectly happy using the software she’d found online. Except it was scarcely fit for purpose. In trying to be “helpful”, the software was prompting her to create transactions based on guesswork, leading to incorrect dates and VAT errors, and it couldn’t generate the basic reports her accountant needed to complete her tax return from.

The only way her accountant could calculate the figures was to spend time exporting the bookkeeping data into a spreadsheet, sorting it, formatting it and adding in manual formulae.

I’m Jill from Springreach Training & Coaching. Through Springreach, I am gently pushing back against ideas like these.

Not everyone needs to use the same software – or even use software at all, if they can keep a spreadsheet that contain all the information their accountant and HMRC requires. One size doesn’t fit all.

And it does matter whether your accountant likes the software you’re using. If your accountant isn’t recommending a certain software package, it’s likely there’s a reason for it. Just like there might be a reason why they’re recommending a change.

For more bookkeeping, software and tax tips, follow 𝗦𝗽𝗿𝗶𝗻𝗴𝗿𝗲𝗮𝗰𝗵 𝗧𝗿𝗮𝗶𝗻𝗶𝗻𝗴 & 𝗖𝗼𝗮𝗰𝗵𝗶𝗻𝗴 on social media or sign up to my mailing list. Link in the comments below.

[Image credit: marc belver colomer on Unsplash.]