BTCSoftware today announced the successful completion of a trial which explored the benefits of adding Digital Nudges and Prompts to Corporation Tax software.
Working with HM Revenue and Customs (HMRC), the Digital Nudges and Prompts trial added error correction prompts into BTCSoftware’s Corporation Tax (CT) filing software to test the efficacy of new digital content with the aim of improving customer filing accuracy.
From August 2021, BTCSoftware’s users were shown error correction prompts relating to two common errors:
- Business entertaining add-back in the CT computation
- R&D Tax Credit claims that included incorrect values (e.g. wages and salaries).
Nicole Newbury, HMRC’s Director for Wealthy and Mid-sized Business Compliance, explains the purpose of collaborating on this trial, “We want taxpayers and businesses to get their tax affairs right, from the outset. Working with BTCSoftware on the Corporation Tax digital prompt trial has helped provide the evidence needed to build correctness into tax and business reporting software, as a default, and prevent non-compliant outcomes happening in the first place.
“In the last six years, we have trialled and deployed over 50 nudges and prompts across multiple tax regimes in our own filing software – benefits include over £800m additional tax paid at the right time, improved customer experience and reduced customer and HMRC costs for error correction and investigation.
“HMRC’s engagement with BTCSoftware in relation to this trial should not be seen as an endorsement of their product or services.”
It is estimated that this specific trial prevented around £94,000 of avoidable CT calculation errors, creating efficacy for both the user and for HMRC.
“BTCSoftware has a long-standing tradition of adding features to our software with the user in mind. I’m pleased to be able to share news of this latest collaboration with HMRC with our community,” says Rob Ellis, CEO of BTCSoftware. “Digital Nudges and Prompts have been shown to work for both tax agents and HMRC. The trial shows that we can provide a clear and simple way to reduce common errors.”
Demonstrating the success of this Digital Nudges and Prompts trial in BTCSoftware’s Corporation Tax module:
- around 950 customers have now confirmed their position in regards to entertaining to help clarify their position and avoid any unnecessary questions from HMRC
- we can estimate that an additional 711 companies added back an average of £877
- and the total additional profits chargeable to CT amounted to £634,000
The Digital Prompts and Nudges trial is set to continue and will test additional improvements to the Corporation Tax filing process.
Corporation Tax Prompts and Nudges are currently live in BTCSoftware’s CT module, available from £178 + VAT. For more information on BTCSoftware’s Corporation Tax module, please click here.
About BTCSoftware
BTCSoftware was founded over 20 years ago on the principle that collaboration between accountants in practice and software developers is key to creating reliable solutions to the challenges accountants face.
Today, we keep our focus on that same spirit of collaboration. It means we take pride in innovations that benefit accountants, like Prompts and Nudges, our upcoming SaaS release and our expert support.
You can contact us on 0345 241 5050 or request a demo here.
