As the first MTD quarterly filing deadline gets closer, what are you prioritising right now to be ready?
The reality is that no firm has been through this exact process before, so it’s understandable for anyone to be feeling a little uncertain.
Indeed, TaxCalc’s MTD expert Nick Moss says the first MTD quarterly filing is "a step into the unknown for so many people".
With that in mind, we asked Nick what should be on every accountant's checklist to help you prepare for the first quarterly filing deadline on 7 August.
Before anything else (if you haven’t already done so), make sure you know exactly which clients fall into the first MTD cohort.
Without that visibility, it's impossible to plan workloads, communicate effectively or ensure nobody slips through the net.
Nick says identifying affected clients should be every firm's starting point. Once you know who those clients are, you can begin preparing the right workflows, communications and support for each one.
This is arguably the most important point on the checklist – and certainly one that deserves underlining and putting in bold.
Can you see which clients have provided information, which still need chasing and which quarterly updates have already been submitted?
For Nick, this is the single biggest factor in whether a practice thrives or struggles under MTD.
He warns: “If you've got a bad process for tracking it, you're going to struggle.”
"If I were running a practice right now, I'd be prioritising having a system in place to track where everything is up to. At the click of a button, you should be able to see which returns haven't been received, which need chasing and which have already been filed.”
He says this is where Engager comes into its own, enabling you to comprehensively track all of these elements with the Kanban-style board.
Not every client will work in the same way.
Some will use bookkeeping software. Others may prefer spreadsheets. What matters is understanding how each client will provide the information needed for quarterly updates.
Nick also recommends thinking about consistency from the outset.
"Make sure clients using spreadsheets have a standard template to work from rather than everyone creating their own version. The more consistent the process is, the easier it becomes to manage."
MTD will introduce a completely new workflow for many firms.
The more consistency you can build into your processes now, the easier it will be to manage multiple deadlines and growing workloads later, says Nick.
"Consistency is the key in this process. As soon as things start to diverge from the norm, they become more difficult to manage” he says.
That applies to everything from onboarding and information gathering to record keeping and filing.
One of the biggest causes of stress isn't filing the update itself. It's waiting for clients to send the information you need.
Nick believes practices should focus on bringing information forward wherever possible.
"If firms had all the information they needed on the first day of the filing window, they'd be absolutely fine. But the problem is that clients will likely send their information at the end of July instead.”
The answer?
“Be as proactive as possible with getting the automated chaser emails out to clients, that will make life so much easier.”
The earlier clients provide information, the more time there is to spot any problems and complete submissions without a last-minute rush.
Who is responsible for maintaining records? Who is updating spreadsheets? Who reviews the information and who submits the quarterly update?
If those responsibilities aren't clearly agreed, confusion can quickly follow.
Nick warns that many firms could find themselves assuming a client has completed work, while the client assumes the practice is handling it.
"It's important that everyone understands their responsibilities in the process and has those clearly defined. Otherwise, you can get to the deadline and discover neither side has done what the other expected."
If you're feeling nervous about the first filing deadline, you're not alone.
But Nick says flawless submissions are not a realistic expectation for this inaugural filing, saying this time around is a “learning experience”.
"I'm not expecting Q1 to go perfectly for anyone. This is new for clients, it's new for accountants and everyone is learning as they go."
Instead of chasing perfection, he believes firms should focus on building good habits now and refining their processes over future quarters.
"The firms that succeed won't necessarily be the ones that get everything right first time. They'll be the ones that learn from Q1, putting changes in place for Q2 and have things running smoothly by Q3 and Q4."
If you only focus on one thing right now, this is Nick's advice: don't underestimate the importance of tracking. When you know exactly where every client stands, everything else becomes easier.
Want to learn more about how TaxCalc and Engager can help your firm tackle MTD quarterly filing simply and successfully? Find out more.
Book a demo to see MTD Quarterly Filer in action