UNITED KINGDOM
URL:1 https://www.gov.uk/government/publications/xbrl-guide-for-uk-businesses/xbrl-guide-for-uk-businesses
XBRL guide for businesses
1 Introduction
This document is aimed at business users of XBRL. This includes businesses that file financial data in Inline XBRL (iXBRL) and accounting firms that advise them or prepare reports on their behalf.
It will help companies to understand the implications of the use of iXBRL for filing of Company Tax Returns to HMRC and accounts to Companies House.
Legislation, which came into force on 1 January 2010, means that it is compulsory for companies to send their Company Tax Returns online using iXBRL for accounts and computations. It is no longer acceptable for most companies to send either the accounts or computations on paper or as a Portable Document Format (PDF) attachment to an online return. Unincorporated charities, clubs and societies may use either iXBRL or PDF for their accounts, but any computations must be in iXBRL format. The new requirements are effective for returns delivered on or after 1 April 2011, for any accounting periods ending after 31 March 2010.
As a transitional measure small charities will be able to file accounts in either PDF or iXBRL. Any computations must be in iXBRL format.
HMRC and Companies House provide a free Corporation Tax online service for small unrepresented companies with relatively straightforward financial affairs. It includes specially formatted accounts and computations templates which if used will make sure data is submitted in iXBRL format.
Read about who can and who cannot use the Corporation Tax online filing service.
Companies must also make Corporation Tax payments and related payments electronically from 1 April 2011. Related payments include interest charged on overdue Corporation Tax and penalties for not filing Company Tax Returns on time.
Most companies will not have to take special steps to convert accounts or computations into iXBRL themselves. This will be done automatically by commercially available final accounts production (FAP) or tax preparation software. However, FAP and conversation software users may have to do some manual tagging initially to expand on the automatic tagging provided by the software.
Many larger organisations produce their accounts and tax computations using a word processor or spreadsheet programme; they don’t use FAP software. They can continue to do this, if they choose, but they’ll need to insert XBRL tags and convert the documents/spreadsheets into an iXBRL file using conversion software and file as part of their Company Tax Return.
This guide explains these issues. Further information on XBRL is widely available on the internet and in printed publications. In particular, the XBRL UK and XBRL International websites provide general introductions to XBRL as well as technical information.
2 XBRL – the basics
2.1 What XBRL/iXBRL is
XBRL involves the application of computer-readable tags to business data. This enables the data to be processed automatically by software, bringing great gains in efficiency and providing an opportunity for high quality analysis of business information.
A company’s financial statements, which have been converted into Inline XBRL (iXBRL), may appear unchanged to a human reader, but they will contain tags, usually hidden to the eye, which can be accessed and used by software. XBRL can provide an identifying tag for each individual item of business data. For example, ‘operating profit’ has its own unique tag, as does ‘current assets’.
The use of XBRL for filing accounts in the UK is not new. Companies House has been accepting abbreviated and dormant accounts from audit exempt companies in XBRL for a number of years using a simple, template-driven system. Many hundreds of thousands of accounts have already been filed in this way.
Many types of software and data systems have been applying computer-readable tags to financial data for years. However, these have been defined differently for each purpose and each type of software. Tags in one system were meaningless to another. No generic processing of the data was possible.
XBRL is different. It is a world-wide standard, developed by an international, non-profitmaking consortium, XBRL International Inc. (XII). XII is made up of many hundred members, including government agencies, accounting firms, software companies, large and small corporations, academics and business reporting experts. XII has agreed the basic specifications which define how XBRL works.
Clearly, different countries use different accounting standards. Reporting under each standard reflects differing definitions. The XBRL language uses different dictionaries, known as ‘taxonomies’, to define the specific tags used for each standard. Different dictionaries may be defined for different purposes and types of reporting. A special taxonomy, the Global Ledger or GL Taxonomy, is intended to enable the efficient handling of financial and business information, at a transactional level, contained within an organisation.
In the UK, three main taxonomies will be used for company reporting: Financial Reporting Council (FRC) Taxonomy set for accounts, the Corporation Tax or ‘CT’ Computational Taxonomy to for tax computations and the Detailed Profit and Loss taxonomy for detailed profit and loss statements that are attached to the accounts or computations.
The XBRL format being used in the UK for company reporting is known as Inline XBRL or iXBRL. This consists of a human-readable report, which has XBRL tags embedded in it. The human readable text is effectively HTML – the basic language of the web. The web file contains the XBRL tags, but they are usually hidden and are only displayed to human eyes when required by software – for example during a process to check the tags.
2.2 How iXBRL is being used in the UK
The legislation means that most companies must file their Company Tax Returns, including financial accounts and computations in iXBRL from 1 April 2011, for accounting periods after 31 March 2010.
On 1 September 2009, HMRC and Companies House issued a statement announcing a common approach to the online filing of company accounts that would enable both organisations to receive accounts in iXBRL format. HMRC and Companies House introduced a joint filing service for company accounts in October 2010. The service, enables most small companies with relatively straightforward financial affairs, to submit their company accounts online to both organisations using a ‘one stop’ online facility.
This guide explains how businesses can convert what they have to file as part of their Company Tax Return into iXBRL. For some, conversion into iXBRL may be achieved automatically by final accounts production (FAP) or tax preparation software, or by using the HMRC service. However, FAP or conversion software users are likely to have to do some manual tagging to expand on the automatic tagging provided by their software.
2.3 What the benefits of iXBRL are
The introduction of XBRL tags enables automated processing of business information by computer software, cutting out laborious and costly processes of manual re-entry and comparison. Computers can treat XBRL data ‘intelligently’: They can recognise the information in a XBRL document, select it, analyse it, store it, exchange it with other computers and present it automatically in a variety of ways for users. XBRL greatly increases the speed of handling of financial data, reduces the chance of error and permits automatic checking of information.
Inline XBRL (iXBRL) offers additional benefits as it presents XBRL data in a human readable form, either on screen or in printed output. It also enables the author’s branding and layout to be maintained so that the recipient can view the same document the author created, whilst the computer can ‘intelligently’ recognise the embedded XBRL tags.
HMRC will benefit from much more effective analysis software, cutting out unnecessary queries and helping to deliver better automated risk assessment so they can focus resources on businesses where the compliance risks are greatest. In addition HMRC and Companies House will achieve major improvements in the speed and efficiency with which they handle business data. Both will cut out manual processes and handling of paper.
As iXBRL becomes established, many companies may find that they can benefit from using XBRL to improve internal processes. XBRL has many potential benefits for businesses. By upgrading systems to utilise XBRL they can streamline and automate their methods for collecting, assembling, monitoring and reporting business data across their whole operation. They should be able to integrate disparate data systems. They can also turn internal management reporting and external reporting into processes which are fast, efficient and cost-effective.
Companies may want to discuss the exploitation of these benefits with their accountants and software and system providers. Consumers of financial data, including banks and other financial institutions, investors and analysts, can receive, find, compare and analyse data much more rapidly and efficiently if it is in XBRL or iXBRL format.
3 iXBRL Reporting – How it impacts your Business
3.1 Basic Principles
iXBRL is purely concerned with the introduction of computer-readable XBRL tags into business reports to enable automated handling of financial data. It should not otherwise change the nature and content of company business reports. That continues to be determined by individual companies in the light of accounting principles, company law etc.
Those who read business reports in iXBRL need not be aware of the existence of XBRL tags. They may see some changes in the way the user interface of such software works, but the creation of the XBRL tags will be hidden.
This chapter looks at the impact of iXBRL reporting on different types of companies.
3.2 Small companies with simple accounts who do not use accounting software
HMRC provides a free Corporation Tax online service that can be used by most small unrepresented companies with relatively straightforward financial affairs to file their Company Tax Returns online. It includes specially formatted accounts and computations templates which if used will make sure data is submitted in the right format.
Read about who can and who cannot use the Corporation Tax online filing service.
HMRC and Companies House also provide an optional joint filing service that enables small companies to enter their accounts data once. The service can be used to submit full or micro entity accounts over the Internet to HMRC as part of the Company Tax Return and also to send these – or an abridged version – to Companies House. If a company’s financial reports contain data not catered for in the template provided, then the company won’t be able to use it.
Companies will need to register to use the HMRC Corporation Tax Online Service to submit their returns online whatever service or software they choose to use. An activation code will be posted out that can take up to seven days to arrive so companies are advised to register early.
Read about how to register and use the HMRC Corporation Tax Online service.
3.3 Companies using final accounts production and tax preparation software
Companies should talk to their commercial software provider or supplier to make sure that the product offered meets their needs and allows them to deliver a fully compliant Company Tax Return.
HMRC publishes a list of software companies who have successfully tested their products with them and provided evidence that they have either developed software or manage a service (or both) that can produce one or more elements of a Company Tax Return. Inclusion in the list does not imply any judgement by HMRC on the general quality of the software; it simply indicates that the software meets certain basic criteria including producing technically valid iXBRL output.
Companies and accountants should consider what processes to follow if accounts and tax computations are produced at different times, possibly by different individuals or firms. Since both accounts and computations must eventually be filed in iXBRL, it may be sensible to make sure accounts and computations are produced in iXBRL when first completed, rather than trying to convert them at a later date. However, it is up to companies and accountants to determine what processes to follow in the light of their circumstances. As discussed below, it is the responsibility of companies to make sure they comply with statutory filing requirements.
3.4 Companies creating accounts or computations through manual processes
Large companies, among others, may create their accounts and other reports using Excel, Word or similar text-based software. These companies may elect to integrate final accounts preparation software into their systems and processes. Alternatively they have two options for converting their data into iXBRL format:
- use conversion software to turn data from Excel or similar programs into iXBRL. This will involve some manual effort in identifying and applying the correct tags. The degree of effort and nature of the task will vary depending on the software chosen. A number of conversion products are available. Some conversion software is listed as ‘recognised’ on the HMRC website and company accountants or others may be able to offer advice on the merits of suitable software. Software may allow templates to be created which will enable tagging to be reused for subsequent reports, so that conversion, once done for an initial report, becomes straightforward in the future. In some cases, it may be possible to use the same template across a range of subsidiaries within a group. The basic issues involved in tagging financial reports and producing iXBRL are described in the next chapter
- outsource the conversion of reports into iXBRL to an external organisation. These take accounts prepared in a traditional manner, covert them to iXBRL and add the tags
3.5 Company Responsibilities for iXBRL filing
It is a company’s responsibility to make sure that it adequately complies with requirements for filing in iXBRL. Companies which are using final accounts production or tax preparation software to file in iXBRL should make sure that their software is adequate to handle the type and scope of data in their reports. They may wish to consult their software providers or accountants on this point.
Companies using external managed tagging services to produce iXBRL formatted accounts and/or computations are responsible for making sure that it can be incorporated with the online CT600 return form for submission. Companies using conversion software to turn their accounts and computations data into iXBRL in-house are responsible for making sure these comply with HMRC online filing requirements. They may wish to consult their accountants or auditors on their processes.
4 Creating Reports in iXBRL
4.1 Creating iXBRL reports – Introduction
This chapter is aimed at businesses that wish to create reports in iXBRL using conversion software and partly manual processes.
It outlines the principles, as well as the risks and issues involved at a business level. It is intended to give a view of the nature of the task involved in conversion. It is not possible to give an estimate of the effort required, since this will depend on the size and content of a report and the software and methods chosen.
A separate ‘Preparers and Developers Guide’ provides detailed guidance for those working on this task.
4.2 Creating iXBRL Reports – The Basic Principles
The conversion of reports in ‘native’ format, such as Word or Excel, into iXBRL involves matching the data in the accounts and tax computations with XBRL tags from the appropriate taxonomies using a software tool that presents the marked-up (or ‘tagged’) report(s) in an (X)HTML document.
Ideally – and in practice most of the time – such ‘data tagging’ should be straightforward, with an obvious one-to-one match between financial line items and tags in the report. However, there will be times when it is not obvious what the most appropriate match is, or that it becomes clear that no match can be found. This is due to the fact that company accounts and computations are varied and detailed. The UK taxonomies which define the available tags have to be large enough to provide tags for most items which typically appear in financial reports, but they are not exhaustive.
Therefore, although taxonomies and conversion software are designed to make manual tagging as easy as possible, it will inevitably involve time and effort, especially in the first instance.
After the first year, people will have a better understanding of taxonomies and the tagging process. As they move forward, the previous year’s tagging will form the basis of the next year so things will get easier and quicker.
The precise mechanisms of tagging and data entry will depend on the software chosen. For example, some existing software requires a tag to be dragged from a taxonomy list onto the appropriate line item in an Excel file. However, other software products may offer different features, such as the use of prepared templates.
4.3 Presentation of reports in iXBRL
The human readable presentation of reports in iXBRL is entirely in the hands of preparers. The fact that underlying tags are being added need not influence the presentation which a company chooses to adopt – layout, style, terminological and branding preferences may all be preserved.
Companies should continue to describe line items in accounts in the way they choose. The description of tags in taxonomies is purely to identify the tag clearly; they are not intended to determine how a company describes that item. Tag descriptions will not necessarily align exactly to wording in accounts but the concepts they both represent should match sufficiently well.
4.4 Taxonomies
The taxonomies (or dictionaries) currently used for filing to HMRC and Companies House are:
- FRC accounts taxonomy – this taxonomy must be used by companies to tag accounts prepared under one of the following accounting frameworks:
– EU-adopted International Financial Reporting Standards (IFRS)
– Financial Reporting Standard (FRS) 101
– FRS 102
– FRS 102 Section 1A Small Entities
– FRS 105 The Financial Reporting Standard applicable to the Micro-entities
and for charities that prepare statements under the Statement Of Recommended Practice (SORP) (FRS 102)
- CT – Computational Taxonomy – this taxonomy must be used to tag the tax computation submitted as part of the company return
- Detailed Profit and Loss Taxonomy this taxonomy must be used to tag a detailed profit and loss statement that has been submitted as part of the company return.
The accounts taxonomies include some common components. These cover standard business information, such as company name, activities and similar data, and standard reports such as the Directors’ Report and Auditors’ Report.
The accounts taxonomies are available for download from the XBRL UK website and the CT taxonomy from the GOV.UK website, but we expect them normally to be bundled with conversion software. Taxonomies can only be viewed in suitable software. However, XBRL UK has provided Excel lists of their content, but these provide limited views of the taxonomy.
Taxonomies like the FRC accounts taxonomy present a list of tags in the same format as a set of typical accounts, with a profit and loss statement, balance sheet, notes to the accounts as appropriate.
However, because taxonomies have to cover a large range of possible tags, their content is much larger than that of ordinary single company reports.
The labels on tags are similar to those in ordinary accounts, but tend to be longer and more explicit in order to identify them clearly.
The label and position of a tag in a taxonomy will normally identify it unambiguously, but taxonomies also provide subsidiary information, such as debit or credit type and accounting references, which may aid in identification. Taxonomies inevitably present a ‘common denominator’ view of data. Their structure will not necessarily match that of an individual company’s accounts or computations. In some cases, a company may need to use a tag from the taxonomy notes within a primary statement and vice versa.
The taxonomies only provide tags for data items whose appearance in company reporting is reasonably typical or predictable. They do not define tags for every eventuality or for company-specific or unusual line items. Therefore, it is almost inevitable that items will exist in the financial accounts which will have no XBRL tag. This is acceptable to HMRC since these items will still be visible in the human readable web document, which preserves the full format and details of the accounts.
Taxonomies will be updated from time to time, probably on an annual basis, to reflect changes in regulations and feedback from users. Announcements on updated versions and their dates of validity will be published via XBRL websites and other normal channels. Software providers are expected to update their software where necessary to handle the new taxonomies.
4.5 Scope of tagging
The accounts sent with your return need to be in iXBRL format if they are required to be prepared under any of the following legislation:
- Individual accounts required to be prepared under Chapter 4 of Part 15 of the Companies Act 2006
- Building Societies Act 1986
- Friendly and Industrial and Provident Societies Act 1968
- Friendly Societies Act 1992
- Insurance Accounts Directive (Miscellaneous Insurance Undertakings) Regulations 2008
In addition – overseas companies resident in the UK must deliver the accounts required by a notice to deliver a return in iXBRL. Also a company not resident in the UK, but carrying on a trade in the UK through a permanent establishment, branch or agency in the UK, must deliver any trading and profit and loss account and any balance sheet of the UK establishment, branch or agency required as part of its return in iXBRL format.
Non-resident companies that need to file a Company Tax return but which are not carrying on a trade in the UK through a permanent establishment, branch or agency in the UK, must deliver accounts and computations in iXBRL format if they are prepared using an accounting standard that is supported by an XBRL taxonomy that is accepted by HMRC. If the accounts are prepared to an accounting standard not supported by HMRC, they do not have to be filed in iXBRL but must be submitted as a PDF attachment to the online return.
In other circumstances, accounts can be sent as either iXBRL or PDF files.
Accounts often include more than just financial data, for example charts and diagrams showing trends over a number of years, comparison with sector indices and general descriptive information on the scope of business and operations etc. Not all of this needs to be tagged. The following describes how preparers should identify which data within a set of accounts needs to be tagged:
- the starting point is the accounts you are required to send as part of a Company Tax Return in iXBRL format. For example, a company incorporated under the Companies Act is required to send the individual accounts they must prepare for their members – a balance sheet, a profit and loss account and notes to the accounts -including any Directors’ and Auditor’s reports similarly required
- all instances of data within the balance sheet, profit and loss account and notes to the accounts must be tagged. If a data item appears more than once then it must be tagged each time
- the Directors’ report and Auditor’s report must also be tagged, but only to the extent that data within these are also within the Directors’ report and Auditor’s report sectionsof the taxonomy (together with general information, such as company name, CRN, etc).
- prior period comparative figures within the accounts should be tagged
- there is no requirement to tag other textual reports, such as the Chairman’s statement, financial review etc
Preparers must tag items in financial reports for which a tag exists in the appropriate taxonomy. If no tag is available, the data concerned should simply be left as plain text.
4.6 Joint filing common validation checks for tags
There are some ‘mandatory’ tags that are needed for ‘boundary validation’ at the Government Gateway. These are set out in the ‘Joint Filing Common Validation Checks’ document which forms part of the ‘Corporation Tax Online: internet service technical pack for Software Developers’ – published on HMRC’s website. These include some consistency checks and rules that must be observed.
In some circumstances a Directors’ Report, for example, may not be included with the accounts but the mandatory XBRL tags relating to the Directors’ Report must still be present. In most cases software will prompt this and attach the tag either against data elsewhere in the accounts, or within a ‘hidden’ area within the iXBRL file. If your return is rejected because one or more of these mandatory tags are missing, you’ll need to contact your software provider for advice.
In some circumstances, for example a UK branch of company incorporated and resident outside the UK, there may be no ‘director’ to associate with the XBRL tag for the director approving the report, which is required for validation purposes. In these circumstances, in place of a director you should include the name of the person approving the balance sheet or the CT600.
4.7 Tagging
Most tags in the taxonomies represent specific monetary line items. Some tags represent predictable textual items such as specific accounting policies.
Tags do not exist for large blocks of text, such as the general content of the Directors’ Report. However, tags are available for specific declarations in the Directors’ Report and information required by regulations such as that on political and charitable donations.
Prior period data should be tagged and this is relatively simple since it will use the same tag as current period data. The different time periods are distinguished by setting the date attributes in the tag. Software should allow this to happen very easily. For example, operating profit for the current year has the same tag as operating profit for the previous year. They are just distinguished by the dates applied to them, as in a human-readable report.
4.8 Data entry, tables and other features in financial reports
Accurate entry of data is important in iXBRL since data may be analysed by software which cannot compensate for errors in the same way as a human reader. In particular, XBRL defines particular conventions to make sure that the positive and negative signs on data are entered correctly.
Taxonomies also include features to enable the efficient tagging of data in tables or data which can only be understood in conjunction with other information. For example, director salary only has meaning when combined with the name of the specific director concerned. The taxonomy features concerned are explained in the ‘Guide for Preparers and Developers’ and are beyond the scope of this note.
Where data that is included and tagged as part of the financial statements (balance sheet, P&L account, notes to the accounts) is included as part of a graph or diagram within another section of the accounts, it is not necessary to tag this data again within the graph or diagram.
4.9 Using templates to make reporting easier
Companies which have created a report in iXBRL shouldn’t need to start the conversion process from scratch with another similar report.
They may wish to use the tagging from the initial report as a template for further reports. Some software is expected to provide the ability for saving tagging and creating templates for later use. New reports, for example for the following year, may be fitted into these templates and only data whose definition has changed or which has been added will need to be retagged. Groups may find that it is convenient to produce templates centrally and distribute these to subsidiaries.
Companies should consult their software providers over the template features which they offer.
4.10 Checking iXBRL reports
Companies are responsible for making sure that their reports are correctly tagged as well as correct from an accounting perspective. By ‘correctly tagged’ HMRC means:
- that all items in the accounts, computation or detailed profit and loss account, which have a corresponding tag in the taxonomy are tagged
- that the appropriate tag has been used for each item with the correct facts, contexts and units
Conversion software should provide convenient means for tags to be checked. The precise mechanism will depend on the application concerned.
Companies should also talk to their auditors about the degree of checking and assurance which auditors are able to give on data tagging.
Other documents will provide more detailed information for those converting accounts into iXBRL or developing software for this purpose such as the technical guidance on the XBRL UK website.
XBRL – when to tag, how to tag, what to tag
Corporation Tax customers will have to file their Company Tax Returns online, with accounts and computations in iXBRL format. Many customers will not need any knowledge of XBRL, or what needs to be tagged. If you use commercial software most of the XBRL tags will be inserted behind the scenes. But, if you need to know a bit more about XBRL tagging, then this document is for you.
Terminology explained
Taxonomy – The ‘dictionaries’ containing the unique XBRL tags.
XBRL – eXtensible Business Reporting Language (XBRL) is a standard for reporting financial data that uses labels or ‘tags’ that computers can interpret.
Inline XBRL (iXBRL) – HMRC has adopted the internationally recognised form of XBRL called inline XBRL (iXBRL), which allows the computer-readable tags to be attached to an electronic file which can also be read by people on screen or in printed form. This means that you don’t have to change the content, style or layout of your accounts and tax computations, and that HMRC will be able to view your Company Tax Return exactly as you’ve submitted it.
When and how to tag
You have a choice of when and how to embed XBRL tags into your accounts. The requirement to file a Company Tax Return online with accounts and computations in iXBRL format does not mean you need to change your accounting processes. It is only the final figures that need to be tagged. Your main options are as below.
Use commercially available software for final accounts production
Commercially available final accounts production and Corporation Tax computations software products will attach the XBRL tags automatically. The tagging is done when data items are keyed in to pre-defined default fields or, if enabled, automatically populated from book-keeping or accounting software packages. Some ‘Final Accounts Preparation’ software presents users with ‘free format’ fields, which the software can’t tag automatically. You may find it helpful to familiarise yourself with what items within accounts need to be tagged, especially if you have bespoke items not included in the predefined software fields within your chosen software. There is more information on the HMRC minimum tagging lists later in this document.
You’ll need to ensure that the software you choose meets your needs, but it should mean that most of the XBRL tags will be embedded automatically.
If you use a customised accounts production package, you’ll need to consider how the XBRL tags are to be attached and at what stage in the production process. If you have separate in-house finance and tax departments, then you need to consider who will be responsible for tagging the accounts.
Instruct a tax agent or adviser to prepare your accounts, computations and file your return
Your agent will prepare your accounts in the usual way and insert XBRL tags for you, probably using the commercially available software mentioned above. If you currently give your accounts to your agent as a PDF file, they may need to receive them one stage earlier in the process, perhaps as Word or Excel documents.
Convert accounts prepared using software like Word or Excel
If you currently use software applications such as Excel or Word to produce final accounts, there’s no need to change your process. There are ‘conversion’ software products being marketed that embed XBRL tags into final accounts Excel/Word documents ‘after the event’ and then convert the accounts to iXBRL format. See later in this document for more detail. These products will vary in sophistication and their level of automation. Where accounts preparation is standardised across a group of companies, templates created within these applications may be reusable across a group. You may want to think about standardising templates now, but remember that any template should only be tagged using conversion software, otherwise the resulting file won’t be in the necessary iXBRL format.
Outsourced XBRL tagging
Outsourcing means you arrange for a specialist provider to tag your company’s final accounts and then return them to you in iXBRL format. You would then attach those accounts to your Company Tax Return (CT600), along with your tax computations (also in iXBRL format) to complete your Company Tax Return.
You would then submit your return online. Any other supplementary information you want to disclose may be attached to your Company Tax Return as PDF files.
Corporation Tax Online commercial software options
Taxonomy minimum tagging lists
To minimise the burden on companies, when the use of XBRL became mandatory HMRC initially published minimum tagging lists for the GAAP, UK-IFRS and CT computational taxonomies. The lists specified the items that had to be tagged if present in any given set of accounts and computations. Companies could choose to disregard the lists and adopt full tagging instead.
From the introduction of the CT dimensional taxonomy onwards, the taxonomy itself is considered minimum tagging, as this taxonomy represents a much simplified requirement. It is the same with the FRC taxonomies, which will not contain a minimum tagging list.
HMRC therefore require full tagging for all taxonomies.
CT Online XBRL Technical Pack
Taxonomy versioning
Taxonomies are updated periodically to reflect changes in legislation and accounting standards. HMRC will publish a ‘valid from’ date and (when appropriate) a ‘valid to’ date for each version of a taxonomy.
In time there will be overlaps, or periods, when more than one version of a taxonomy could be used to tag a set of accounts. It is acceptable to use any one version of the taxonomy, provided the final day within the period of accounts falls within the ‘valid from’ and ‘valid to’ dates for that version. For computations, the end date of the accounting period must fall within the ‘valid from’ or ‘valid to’ period for the taxonomy used.
Which accounts are required in iXBRL format
The accounts sent with your return need to be in iXBRL format if they are required to be prepared under any of the following legislation:
Individual accounts required to be prepared under Chapter 4 of Part 15 of the Companies Act 2006.
Building Societies Act 1986.
Friendly and Industrial and Provident Societies Act 1968.
Friendly Societies Act 1992.
Insurance Accounts Directive (Miscellaneous Insurance Undertakings) Regulations 2008.
In addition, overseas companies resident in the UK must deliver the accounts required by a notice to deliver a return in iXBRL. Also a company not resident in the UK, but carrying on a trade in the UK through a permanent establishment, branch or agency in the UK must deliver any trading and profit and loss account and any balance sheet of the UK establishment, branch or agency required as part of its return in iXBRL format.
In other circumstances, accounts can be sent as either iXBRL or PDF files.
What items within the accounts need to be tagged
Accounts often include more than just financial data, for example charts and diagrams showing trends over a number of years, comparison with sector indices, general descriptive information on the scope of business and operations. Not all this needs to be tagged. The following describes how to identify which data within a set of accounts needs to be tagged:
The starting point is the accounts you are required to send as part of a Company Tax Return in iXBRL format. For example, a company incorporated under the Companies Act is required to send the individual accounts they are required to prepare for their members – a balance sheet, a profit and loss account, and notes to the accounts – including any Directors’ and Auditor’s reports similarly required.
All instances of data within the balance sheet, profit and loss account and notes to the accounts must be tagged. If a data item appears more than once then it must be tagged each time.
The Directors’ report and Auditor’s report must also be tagged, but only to the extent that data within these are also within the Directors’ report and Auditor’s report sections the taxonomy (together with general information, such as company name, CRN, etc).
Prior period comparative figures within the accounts should be tagged.
There is no requirement to tag other textual reports, such as Chairman’s statement, financial review etc.
It’s only necessary to tag items in financial reports for which a tag exists in the appropriate taxonomy. If no tag is available, the data concerned should simply be left as plain text.
What needs to be XBRL tagged – an example
The following table shows what needs to be tagged for a hypothetical set of accounts, which have been prepared using UK GAAP. In this example, the sample accounts contain 200 items of information.
The taxonomy (list) of the elements (descriptions of tags) is the one published for UK GAAP. The full UK GAAP taxonomy, which is published by XBRL UK Ltd, currently contains 6,654 (5,292 plus 1,028 Common Data module items and 334 charities). The minimum tagging list for UK GAAP, published by HMRC, is an exact subset of the UK GAAP taxonomy, and currently has 1,253 items. Remember that you must also tag any data items that map to the Common Data module.
If there are 200 data items in the accounts, a maximum of 200 unique tags will be needed, often less as it will be unusual for all 200 items to appear on the minimum tagging list.
There may be more than one occurrence of an item in the financial statements corresponding to an element in the minimum tagging list. If so, each occurrence of the item must be tagged. This means that a tag may need to be used more than once in a single document.
All repeat occurrences of any individual fact within the financial statements must be tagged – so a data item that appears in say the balance sheet and again in a note prepared as part of the financial statements must be tagged each time.
If your accounts show comparative figures from previous year’s accounts, those previous year’s figures should be tagged, and as most accounts production software products are based on stencils we expect that in practice comparative figures will often be tagged by default.
However, the same tag cannot be used to mark up different facts. The structure of XBRL taxonomies allows similar facts to be differentiated. For example, the Common Data taxonomy module includes all countries and regions, etc so ‘sales to Africa’ can easily be differentiated from ‘sales to India’.
Also note that XBRL caters for all the current rules and mechanisms for rounding. For example if depreciation of £314,568 appears in the notes but is shown as £315K in the balance sheet, provided proper use is made of the attributes included in XBRL tags, with regard to the level of precision etc, these two items could (and should) be reported, effectively with the same tag.
Identifying what needs to be tagged
You only need to tag a data item in your company’s accounts if it also appears in the minimum tagging list. In the example, ‘Turnover’ is in the company’s profit and loss account. As it also appears in the minimum tagging list, the item must be tagged.
In the example, ‘Trade debtors within one year’ is within the accounts and appears in the full taxonomy. But as this item is not also in the minimum tagging list, it doesn’t have to be tagged. The item is in the UK GAAP taxonomy and can be tagged if you choose to do so.
In the sample accounts, ’Turnover’ is further analysed in the notes to the accounts and this analysis includes ’Income from DVD rentals’. This title doesn’t appear in the full taxonomy and it doesn’t have to be tagged. However, you can choose to tag this item by extending the published taxonomy to include this additional description tag. The extended taxonomy would then need to be included as part of the Company Tax Return filed online. This is because one of the basic checks HMRC make when a return is filed is whether all the XBRL tags are recognised, so we need to know about any you have chosen to define and add yourself. How you extend a taxonomy will depend on the software you choose to use. If necessary please refer to your software supplier.
You do not have to create ‘Nil’ items for those items in the taxonomy (and minimum tagging list) that you do not use in your accounts, nor do you have to tag them. In the example, ‘Financial assets carrying value’ does not appear in the accounts and can simply be ignored.
Group and Consolidated Accounts
The accounts requirement (what accounts are required as part of a Company Tax Return) has not changed as a result of the move to online filing. The accounts required are those the company is required to prepare for its members. For most group companies, Companies Act 2006, Section 394 only requires them to prepare individual accounts. These companies will include their individual accounts with their online Company Tax Return.
Where a parent company is required to prepare both individual and group accounts (Companies Act 2006, Section 399) it is required to file both of these as part of its online Company Tax Return. However, it is only required to file the individual accounts as an iXBRL document, with the relevant XBRL tags embedded.
Where the group accounts are a separate document these must be included as a PDF file.
There is no requirement to tag group accounts. In some cases, the group accounts and individual accounts will be part of a single consolidated document. This is acceptable provided it contains all the information which would be available from the individual accounts. It must be filed as an iXBRL document. In the case of a single consolidated document containing both the individual and group accounts, only the items relating to the individual accounts are required to be XBRL tagged.
In practice some companies include only individual account balance sheet data within their consolidated accounts and include other information that would have been within the individual accounts (profit and loss account etc) as part of the Corporation Tax computations. This is acceptable provided all the information that would have been included in the statutory profit and loss account is included within the computations, and the data then included in the computations is appropriately tagged using the Corporation Tax computational taxonomy.
Detailed Profit and Loss Account
The statutory accounts a company is required to produce for its members do not include what is often referred to as a ‘detailed profit and loss account’. However, some companies choose to produce a detailed profit and loss account as part of the process by which they prepare final accounts and include this as part of the accounts with their Company Tax Return. Others choose to include a detailed profit and loss account/analysis of the statutory profit and loss account as part of their computations. The Detailed Profit and Loss taxonomy should be used to tag the data in XBRL regardless of where it is included. If the detailed profit and loss account is produced in both documents you need only tag it once.
Practical example – Controlled Foreign Company
The following applies the XBRL requirements to a situation where a company filing a return needs to report a liability under S747 (Controlled Foreign Companies).
The accounts of the Controlled Foreign Company (CFC) are not legally required as part of the UK ‘waters edge’ company’s return, but often these are sent as part of its return, in addition to its own accounts. Only one iXBRL accounts file can accompany a return and there is no requirement to include the CFC accounts as an iXBRL document. So, if the CFC accounts are included with the return, they need to be attached as a PDF file.
The calculation of tax payable under the CFC legislation has to be reported on supplementary page CT600B. The CT600 and any supplementary pages are not part of an iXBRL file, so the calculation of tax payable under the CFC legislation cannot be XBRL tagged. Where the computation includes calculations of the chargeable profits of a CFC, those calculations need to be included in the iXBRL file. However, there are no tags within the CT Computation Taxonomy relating to the calculation of chargeable profits of CFCs apart from the figure of the chargeable profit itself, so this calculation does not have to be XBRL tagged.
Tagging using ‘conversion’ software –An Example
If you choose not to use XBRL-enabled Final Accounts Production software, then you will need to create an iXBRL file with the necessary XBRL tags, after preparing your final accounts. Conversion software is available to help you do this.
Each conversion product is different and it’s important that, if you choose to create your iXBRL accounts file using this method, you select software that meets your needs. Don’t forget that the software you choose must not only insert the relevant XBRL tags, but finally create an iXBRL file.
Software applications will vary in sophistication, some will tag Excel documents, some will tag Word documents, and some will tag both. Most will remember as you use them, allowing you to build templates for your specific accounts format. They can be reused for a later year, or perhaps across a group depending on the level of standardisation of accounts production.
Typically conversion software will show multiple windows on your screen including those containing the taxonomy you are using and the accounts you need to tag.
A mock-up of what you may see on-screen when using conversion software
Profit and LossYear ended 30 June 2009Turnover1,658,080Cost of sales786,586Grossprofit871,494Distribution356,125Administrative costs272,455Operation profit242,914Interest payable25,756Profit before tax217,158Tax48,256Retained profit for year168,902Item in accounts tagged to the relevant taxonomy elementExact method varies depending on software used, but can be no more than a mouse click
In the left-hand box is an extract from the minimum tagging list for UK GAAP. Each conversion product will present the taxonomy in its own way. Generally the different items are grouped and organised under headings so that it can be expanded to reveal the description for the tag which is appropriate to the item in your accounts that has to be tagged.
In the right-hand box is the profit and loss account from the earlier example showing what to tag. The way you input your accounts data into the conversion software will vary, but could involve uploading a template, cutting and pasting, or re-keying.
You’ll need to identify the appropriate description (element) from the minimum tagging list for each item in the accounts. Remember that if the item in the accounts doesn’t correspond to an element in the minimum tagging list you don’t need to tag that item. Different software will ‘attach’ tags in different ways, so we can’t show the detail here.
Once all necessary tags are inserted, an iXBRL file is created. It’s this iXBRL file, with the XBRL tags embedded in it, which you need to submit as part of the return.