iXBRL (an electronic tagging system for financial statements) – implications for charities
The majority of charity accounts that get filed with HMRC start life as word documents (or excel), whilst the majority of software houses will write their accounts packages to be compatible, where does that leave the practices that do not need the accounts packages because the accounts are in Word/Excel.
In March 2006 a review was carried out of HMRC’s online services. One of the recommendations of the review, which was supported by government, was that HMRC and Companies House should work together to provide a joint filing facility. In support of these recommendations, Companies House has encouraged online filing wherever possible.
Also contained within the review were recommendations that all companies should be required to file their Company Tax Returns online, using Extensible Business Reporting Language (XBRL), and make payments electronically for returns due after 31 March 2011. HMRC has now decided that statutory financial statements and tax computations supporting the entries in the Company Tax Return must be delivered electronically using Inline Extensible Business Reporting Language (iXBRL) format. This requirement will also be applicable to charities, clubs and societies which are required to submit tax returns.