Filing company tax returns to HMRC on-time post lockdown?
Businesses around the world are feeling the impact of the coronavirus (COVID-19). Leaders navigate a wide range of interrelated issues, from keeping their employees safe, ensuring cash flow and liquidity, redesigning operations, and dealing with changes in government-regulated compliance mandates.
More than US$300B has been spent globally to deal with regulatory change. Control, risk, and compliance functions are being considered pivotal in ensuring business continuity. Although many view 2020 and 2021 as a long pause, it has led to shedding light on many issues already in the offing, especially in tax.
Other than affecting their sales and revenues, Covid-19 has also postponed submitting final accounts for most firms and led to them requesting HMRC for additional time to submit their CT 600 tax returns. The whole situation is one of uncertainty, with newer problems emerging every day.
In these uncertain times, when new problems emerge every day, financial leaders across the globe are consistently focused on three principal challenges in dealing with the impact of COVID-19.
1. Delay in Consolidation and Preparation of Accounts
Many companies still have ad hoc data gathering methods in place. Working remotely meant more coordination to obtain expenses/accounts otherwise submitted as physical printed copies. Organizations currently functioning with a siloed management of data for discrete purposes faced a setback.
With the regulatory focus increasingly shifting to digital innovation and sustainable finance, executing the technology component of business continuity plans takes center stage. Often this began with the practical details of enabling people to work from home. Business leaders then usually shift to looking for collaborative platforms or service providers to ensure connectivity within tax functions.
2. Difficulty in Review by Accountants and Auditors
After the initial checking and passing of bills by accountants, the auditing team is generally physically present in the office to write notes, raise objections, approve or send back invoices to be changed. All this was possible over a short turnaround, and the finalization of books was uninterrupted and seamless. However, with the accounting and auditing staff at different locations, delays and errors are inevitable. Online or couriers were resorted to for approvals.
3. Late Approval and Signing-off by Senior Management
Once the accounts are finalized and settled, the physical signing of the documents to be submitted to HMRC by senior management in the office is now a severe roadblock. Sensitive documents that need to be transported to remote locations by courier projects concern financial leaders. This process may even delay submission to regulators and attract unnecessary penalties, adding to cash-flow woes.
Given the pace and volume of new tax measures being introduced in the aftermath of the pandemic, the ability to filter and analyze data to surface opportunities to release cash can offer a huge advantage for companies.
At Datatracks, we work closely with more than 10,000 UK firms in helping them submit their final accounts and company tax returns on time to Companies House and HMRC. We offer conversion of accounts to iXBRL. To find out more, get in touch with us at email@example.com