The January update features the latest developments on Agent Services and Making Tax Digital for individuals.

“Agent Services Account

Agents who need to register a trust using the Trust Registration Service, and those volunteering to participate in Making Tax Digital for Business (MTDfB), will need to create an agent services account. In addition to creating an Agent Services Account, those agents volunteering to participate in MTDfB can also test the following services:

• linking existing self-assessment clients to the agent services account – this involves linking existing agent codes to the agent service account, so an agency can act on behalf of their client without needing to be re-authorised by that client
• subscribing a client to the service – an agency can initially subscribe any existing self-assessment client with who has previously authorised the agency to act for them in SA e.g. 64-8 authorisation is in place
• completing a quarterly update for a client – an agent must have HMRC compatible commercial software to do this

An Agent Talking Points on the Agent Services Account, providing an update on testing and availability of services, was held on 30 November. Agents wishing to view a recording of this session should visit https://www.gov.uk/government/news/webinars-e-learning-and-videos-if-youre-a-tax-agent-or-adviser

Making Tax Digital for Individuals (MTDfI)

The Personal Tax Account

The Personal Tax Account (PTA) continues to grow in popularity with more than 13.7 million users. Some headlines include:

• 6.5 million checked their State Pension forecast
• 7.2 million checked their tax estimate service
• 4.9 million opted in to paperless communication
• since 2016, 3.6 million online P800 refunds
• 6.5 million views of the new tax credit payment service
• 79% of customers were satisfied with the PTA.

PAYE improvements

Since July HMRC has been using real time information from employers to automatically adjust employees’ tax codes. As a result more customers are paying the correct amount of tax each year.

In response to stakeholder feedback we have made further changes. If a customer’s circumstances change between 6 January 2018 and 5 April 2018, and the amount of tax due in the current year is affected, HMRC will adjust their tax code but only start collecting the tax from 6 April 2018. This way customers won’t pay back too much tax in a short space of time. We will put in similar arrangements for future years too.

We will continue to improve the system further and will provide more information in professional body and agent communications and forums.

Self-Assessment (SA) Pre-Population Application Programming Interface

The SA Pre-Population APIs allow agents to access their clients’ PAYE, NI and marriage allowance data via their accountancy software.

The service is proving more popular than we anticipated, with the APIs serving around 150,000 data requests every day. Transaction volumes are increasing as we move through the January SA peak and we are working to increase transaction capacity. Where possible, we encourage agents to consider using the service outside of peak hours (10am-12 noon and 2pm-4pm).

In December we introduced an identity check for agents as an additional security measure. A small number of agents have reported difficulties, and we are investigating these with software developers. We have decided that the service will continue in private beta until after the SA peak.

The latest questions and answers on the service accompany this briefing.

Cyber Security

Bogus Calls

HMRC have updated online guidance Phishing emails and bogus contact: HM Revenue and Customs examples to reflect information on recent bogus phone calls targeting elderly and vulnerable people. The latest bogus calls encourage people to provide financial and personal information in exchange for a bogus tax refund or state that HMRC is filing a lawsuit against them and they must make immediate payment. HMRC advise that anyone receiving calls who cannot verify the identity of the caller should not liaise with them and if an incident has resulted in financial loss this should be reported to Action Fraud. HMRC request that details such as date, time of call and the telephone number used are forwarded to phishing@hmrc.gsi.gov.uk to assist investigations.

View the updated guidance at Phishing emails and bogus contact: HM Revenue and Customs examples

HMRC Agent Standards on keeping data safe

HMRC issued updated Agent Standards on 4 January. Agents are reminded that under HMRC Agent Standards that you have a responsibility to protect your clients data and confidentiality. The National Cyber Security Centre offers a range of guidance on staying secure online, which can be found at: https://www.ncsc.gov.uk/guidance.

Update on HMRC’s 2SV rollout

You may recall that since September 2017, HMRC has been rolling out 2 Step Verification (2SV) as a requirement for all business customers using our digital services. So far, the service has been rolled out to over 250,000 business users. A total of 96% of those registering have successfully enrolled. HMRC’s final phase of the 2SV rollout will begin after the Self-Assessment peak during February 2018.

Get ready to send your client’s 2018/19 Annual Tax on Enveloped Dwellings (ATED) return online

From 1 April 2018, all online ATED returns must be filed using the new ATED digital service. Register now with HMRC to use the new online service well before this date. The old online forms will be withdrawn on 31 March 2018. If you’re an agent, you’ll need to first register your agency, then ask your client to register and authorise you, using a unique authorisation number. This is a one-off process, to enable you to act on behalf of your client for future years.

The new online service enables your clients to:

• receive instant access to registration details online, rather than wait for them to be delivered in the post
• fill in and send any ATED returns online
• get immediate confirmation of submission of a return
• save and retrieve return information before submitting to HMRC
• view or amend returns already submitted
• print a copy of a return already submitted
• get instant access to a payment reference number
• monitor their account, including any outstanding balance
• save information from previous years, reducing the need to key in the same information in later years
• claim relief without the need to enter individual property details, saving valuable time
• complete client/agent authorisation requests online.

As an agent, you will be able to:

• accept your clients’ authorisation requests online
• see a list of all your ATED clients in one place
• send returns on behalf of your clients and manage their online account
• manage your own list of clients within your organisation.

You will not be able to submit a return for the 2018/19 chargeable period until 1 April 2018, however taxpayers can prepare for the annual reporting period by registering and appointing their agent if they haven’t already done so. Go to ATED online for more information.

Reform of Corporation Tax loss relief

The reform of Corporation Tax loss relief was introduced in Finance (No. 2) Act 2017 and took effect from 1 April 2017. It provides for a more flexible loss relief regime by allowing most carried-forward losses arising from 1 April 2017 to be set against total profits of a company and against profits across a group. It also restricts the amount of profit that can be offset through carried-forward losses to 50 percent, subject to a group-wide deductions allowance of £5m.

The following guidance relating to the reform has now been published in draft:

• A first tranche, providing a general overview along with detailed guidance on the loss restriction, the relaxation for trade losses and anti-avoidance rules.
• A second tranche, providing detailed guidance on the relaxation for non-trade losses and on group relief for carried-forward losses.
• Draft guidance on the application of commencement provisions, showing how amounts may be apportioned where a company has an accounting period that straddles 1 April 2017.”

END OF HMRC UPDATE