Cost Implications and Bridging Software

Cost implications to a business

For a business that has been using paper you will now be required to use digital software. There are a number of providers that will offer this on a subscription basis with packages tailored to the size of the business.

HMRC are not offering their own software products, but will provide Application Programming Interfaces (API’s) that commercial software developers can use to develop a range of applications that will let businesses kept records digitally and integrate with HMRC system. An API is software that will link 2 or more software programmes together allowing the exchange of data.

“On average an SME can save 27.6 days a year using digital accounting software in comparison to using a manual method of accounting”.

Businesses must also ensure that staff are trained to deal with the new rules, this may incur costs.

Bridging Software

For businesses still using paper to manage accounting processes, bridging software is an option that enables the business, book keepers and other organisations to link your Microsoft Excel spreadsheets to HMRC.

The software will interact with various HMRC’s MTD VAT APi’s making the submission of VAT returns achievable and simple to complete via the facility to extract VAT 9 Box values.

There are providers that can help with this process, the spreadsheet will need to contain all the necessary transactional data for the VAT period and there is a single sheet calculation where the VAT 9 box values for a VAT period have been summarised. This will be enough for the software to extract the information required by HMRC and business can then use a mapping feature to integrate and extract VAT values.

The transfer of the spreadsheet data into the bridging software must be carried out digitally as HMRC are not enabling the data transferring to be completed manually and will not accept. You will not be able to manually type the values within the VAT boxes of the bridging software.

Bridging software is provided on an annual licence basis and is granted for the use of a specific version of the software and a new licence should be purchased for each version of software your business owns. There software is for one user on one computer and additional licenses must be purchased for other users. Network versions are available. In cases of version upgrades, annual licences of the new version will then supersede the earlier software versions.

Benefits of Bridging Software

Security

• User name and password to access the software

• Security access rights to functions

• Back and restore facilities

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