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HMRC specifies ‘transaction monitoring’ metadata for MTD software

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HMRC has made a statutory direction defining the ‘relevant ancillary metadata’ which MTD-compatible software must capture and transmit to HMRC for anti-fraud purposes, along with the relevant tax information. This requirement is set out in regulations, under which software suppliers who fail to comply may face a penalty of £3,000.

The Delivery of Tax Information through Software (Ancillary Metadata) Regulations, SI 2019/360, impose a requirement on software suppliers to ensure that any tax-related information delivered to HMRC is accompanied by the relevant ‘transaction monitoring’ metadata. Failure to comply may result in a fixed penalty of £3,000, limited to one penalty in a 12-month period in relation to any one product of a supplier. These regulations came into force in 19 March 2019.

HMRC’s ‘Direction under regulation 2(2) of the Delivery of Tax Information through Software (Ancillary Metadata) Regulations 2019’ specifies the relevant metadata ‘header information’. The direction also explains that: ‘Without the protection offered by transaction monitoring, this data could be compromised, leading to fraud against taxpayers or the UK exchequer. HMRC needs to consistently and reliably receive fraud header information to ensure this protection takes place efficiently and effectively. HMRC stores this information securely.’


Issue: 1438
Categories: News