With the coming of Making Tax Digital, the days of cash-in-hand and creative accounting are, rightly, at an end. And that’s fine by us. People need to pay their way in society and, frankly, we don’t want to work with characters like that.
Maybe it’s because I’m from Essex and a bit sensitive about stereotypes.
Perhaps it’s that in a year when we’ve all had to pull together, I’m all the less impressed by people who are only capable of looking out for themselves.
Or it could just be that doing things properly – a place for everything, everything in its place – fills me with joy.
Whatever the reason, I’ve always said that I want Mayflower to be an accountancy firm that can hold its head up high and say, “We play fair.”
Now, don’t get me wrong: of course I’ll use every legitimate avenue available to make sure my clients don’t pay more than their fair share.
It feels harsh to say but some accountants fail to claim tax reliefs and allowances for their clients not on principle but because they’re not very good, or because they’re lazy and can’t be bothered to do the calculations. That winds me up, too.
But integrity matters.
Furlough fraud and worse
It’s been interesting this past year to see some of the unsavoury behaviour around Government support schemes for COVID-19.
Can I furlough staff and keep them working? What about if I tell the Government they’re furloughed and pocket the Government money? How about if I furlough them over the Christmas break when they’re on holiday anyway?
People asking these questions know they’re trying it on and they know it’s not right.
Others are being prosecuted for claiming to have sold non-existent meals under the Eat Out to Help Out scheme back in August. Some have taken out bounceback loans they don’t need, or for fake businesses, or with no intention of ever paying them back.
All this stuff annoys me, to be honest. I wouldn’t want to work with the kind of clients whose minds work this way.
MTD and CIS – nowhere to hide
Making Tax Digital (MTD) is the Government’s scheme to get businesses recording their finances and filing tax returns entirely online.
That means no more receipts on spikes, no more manila folders full of photocopied invoices and no more wobbly spreadsheets on old laptops.
For all the disruption and inconvenience it’s caused in the past five years, I’m broadly in favour. After all, we’re a firm that’s embraced cloud accounting from day one, so it’s no trouble for us or our established clients.
The Government will tell you it’s about convenience and efficiency, which is kind of true, but we all know it’s also about reducing the potential for fraud or tax evasion.
The Construction Industry Scheme (CIS) is another attempt to remove the temptation to undertake work on a ‘cash-in-hand’ basis without paying tax.
The VAT reverse charge for construction, due to come into effect from March 2021, will close another opportunity for dodginess. It will make it impossible for suppliers of construction services to charge VAT at 20% and then pocket it instead of handing it over to HMRC as expected.
You can fight it, or embrace it
For some people, paying any tax at all is almost painful. I get that.
In its own way, it’s a point of principle. It’s your money, you worked for it – why should someone else decide how it’s spent?
But these days, you can end up working very hard to save not very much money, at great risk of investigation, penalties and even prosecution.
Why bother? Why not just do it right.
If you’re ready for a responsive, ethical accountant, let’s talk.