Software vendors have complained that a crucial API that went live last week as part of HMRC's Making Tax Digital (MTD) reforms is returning spurious data – and that the taxman is blaming them.
MTD, announced by HMRC in 2015, will require companies to keep digital records and file quarterly reports with the tax authority. The first phase, for VAT, rolled out on 1 April.
But just a week after the April Fools' Day launch, software vendors have reported problems with the system that they didn't encounter during the sandbox or pilot stages.
It has also left users in the dark about whether their tax returns have been properly filed – and thus concerned that they will be fined for late filing.
The problem is with the MTD VAT API, which vendors use to submit tax returns for their customers but appears to have been returning incorrect VAT obligations data for numerous users since 1 April.
Software vendors appear able to create and submit returns, receiving HTTP 201 (created) for the return. Emails are even generated from HMRC to the user saying that direct debit payments have been scheduled.
However, rather than being listed as "fulfilled" – as they should be – these returns remain open indefinitely. When users contact HMRC, it has no record of the returns having been submitted.
Vendors discussing the problem on a GitHub thread said that for "numerous" VAT Registration Numbers – the unique IDs the API uses to retrieve data – the Get Obligations API had returned incorrect data.
As well as VAT obligations remaining open after returns are filed, one user also reported obligations appearing from before the implementation of MTD and open obligations that do have a return filed date.
Moreover, vendors complained that HMRC's customer support agents are pinning the blame on them, which has left the software-flingers in a tit-for-tat battle with the taxman via their customer.
"The client is also telling us that HMRC has told them that the return has not been filed, yet I just don't think the issue lies with us. Very frustrating," said one.
"It's extremely frustrating because there seems to be no HMRC support on this and we're getting customers complaining and phoning us up on a daily basis," said a second. "We look incompetent to our customers."
Another asked HMRC to update its service status page so they had something they could direct customers to, rather than asking them to take it on faith that the issue isn't with the software. "I don't really fancy sending them links to GitHub," that poster mused.
Mark Kelly, a Scala developer working on VAT APIs for MTD, said he had raised the issue "as a matter of urgency", and that he would "look at getting something done" about a public statement.
Frustrations about the glitch have been exacerbated because the support process is, in the words of one vendor who asked not to be named, not fit for purpose.
A customer support model that will help direct agents to the best support is still being developed by the HMRC Developer Hub, and vendors have reported that they are being passed from pillar to post. One summarised it thus:
The [software developers support] team won't investigate individual cases because they don't have access to the data, the MTD helpdesk won't discuss the issue with the software vendor because they'll only talk to the business, and neither the business nor the MTD Helpdesk has enough technical knowledge to discuss the issue in sufficient detail.
Kelly acknowledged there "should be a better way of raising live support issues with the MTD programme", but said that for the time being his team had been told to say that, because it relates to a VAT issue, users should contact HMRC directly.
HMRC sent us a statement:
"As we did during the pilot, HMRC is continuing to work closely with developers to ensure our service is smooth and that teething problems get resolved quickly." ®