Businesses and advisers who do not use accounts production software will have to review their systems so they can file their company accounts returns online by 2011.
HMRC has decided that after 31 March 2011, company accounts as well as company tax returns must all be filed online in a specified data format (known as Inline XBRL or iXBRL). This will replace the PDF format. It is one of Lord Carter's recommendations for HMRC's online services, but it is designed to cut HMRC's costs so it can read data electronically.
We are told that we will be able to use HMRC’s software or commercial software to convert our accounts into the right format, but each line has to be tagged and so it is difficult to see who this will work.
Nichola Ross Martin comments:
"I am sceptical about the economics behind all this. Aside from the technical nightmare for developers in tagging. Think about the hideous problems that you will face if your software does not convert into XBRL."
Tax committee members at a recent ATT meeting were unconvinced of the benefits of this aspect of Lord Carter's recommendations for HMRC and it is unclear if, or how documents can be transformed without additional software.
