The latest Digital Update from HMRC is available and contains important information on agent services and authorisation. Readers are advised to ensure they take time to digest its contents.

Agent Services

From Summer 2017, Agent Services will connect tax agents with HMRC online, in real time. Paper forms and postal applications will start to be replaced by fast and secure digital transactions ensuring Agent Services delivers:

• an agency creating a new Agent Services Account
• links to existing agent codes to the new Agent Services Account
• the ability to add and remove clients’ through new software based agent authorisation service.

When can I get an Agent Services Account?

HMRC is currently testing the Agent Services Account with a small number of agents. This is to ensure that HMRC backend systems are working as intended, and improvements made prior to a wider release.

What is linking existing agent codes to the new Agent Services Account?

Once an agency has created an Agent Services Account and connected it to their accounting software, they can link their existing agent codes to the Agent Service Account, so they can view their client’s data and share updates with HMRC at any time. Likewise, agents will be able to access and work with their existing client’s tax information without the need for re-authorisation.

When can I start adding my existing Self-Assessment client relationships?

The agents who created an Agent Services account, which is the step required prior to an agency adding their existing client relationships, were introduced to the user journey in June. Once the journey has been finalised, HMRC will make the journey available for wider release.

What is an Agent Services Account?

An agency will create a single Agent Services Account and connect it to their accounting software. The creation of the account is a one off process. It will need to be completed to enable the firm and its staff to access MTD Income Tax Self-Assessment services and act for their clients. Because an agency will be working through software to access these services, it will be software that will need to be used to control staff access.

What is the Agent Services Authorisation Service?

By creating a single Agent Services Account, and linking existing agent codes to that account, an agency will not be required to re-authorise when continuing to act for self-assessment clients.

To add a new client, an agency will use the agent authorisation service. The service allows an agency to send a direct request from accounting software to their client. The client will then have the opportunity to accept or reject the request either in commercial software or via an HMRC digital tax account.

When can I start to use the new Agent Services authorisation service?

The APIs will be available to software developers in the summer, so an agency may want to contact software providers to get an idea of when the agent authorisation service will be available. The functionality for a client to accept or reject the request from an agency via a non-software journey will also be available in the summer. In the meantime, if new agent authorisation relationships need to be forged for making tax digital for business purposes then this can completed using the form 64–8, but this can take up to 20 days to be processed, or the existing online agent authorisation.

SA Pre-Population APIs

The SA Pre-Population APIs allow agents using third party software to retrieve a variety of PAYE, NICs and Marriage Allowance data to pre-populating SA returns.

This is similar to the data that taxpayers have access to when submitting SA returns online themselves, although at this point not all data items are available through the APIs (e.g. state pension).

The APIs are currently in a private beta trial – not all software providers are involved – check with your software provider to learn of their roll-out plans. During the private beta we are collecting feedback from software providers and agents to provide the best possible service.

Trial participants must use 2 Step Verification (2SV), which means that agents need to have a landline or mobile phone to hand to complete the process. This provides an extra layer of security. The majority of agents are reporting they’ve found it very easy to use.

A key known issue is the timely availability of data – currently the APIs only provide data post “reconciliation”, with data appearing sometime between May and September. We are looking to improve this in the future.

Business Tax Account (BTA)

Apprenticeship levy

The apprenticeship levy was introduced on 6 April 2017, which means some UK employers now need to calculate, report and pay a contribution towards the apprenticeship levy to HMRC through the PAYE process, each month. Levy payers need to use the Employer Payment Summary (EPS) to report any levy due, and should pay the apprenticeship levy alongside tax and national insurance contributions by the 19th (or 22nd if paying electronically) of each month.

Since 28 April 2017, employers have been able to see their apprenticeship levy data using their Business Tax Account. However agents will not be able to view their clients’ apprenticeship levy data through Agent Services until late 2017.

Detailed guidance on the Apprenticeship Levy is available on GOV.UK

Personal Tax Account (PTA)

PAYE

Changes to PAYE

From 3 July HMRC introduced changes that mean we are using real time information from employers and pension providers to make automatic adjustments to PAYE tax codes. These improvements were introduced so that more people pay the right tax at the right time.

The article in Agent Update 60

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/623008/Agent-update60.pdf provides information on these improvements to PAYE.

You can find more information on GOV.UK, and sign up and take part in Agents Talking Points on Agent toolkits, digital meetings, webinars, e-learning and videos https://www.gov.uk/government/news/webinars-e-learning-and-videos-if-youre-a-tax-agent-or-adviser.

Cyber Security

Cyber Security Alert

Recently HMRC was made aware of a phishing campaign targeting businesses. The emails sent to businesses has “Your 2016 Tax Report” in the subject line and contains a word document which is malicious. Agents should be cautious of unexpected emails or files purporting to be from HMRC.

If you think that an email is suspicious please report it to phishing@hmrc.gsi.gov.uk.

If agents or their clients, have fallen victim to phishing and suffered financial loss, please report this to Action Fraud through their website, or on 0300 123 2040 (Please note this number will be charged at your normal network rate). They are open Monday to Friday 09:00–18:00.

Agents and their clients should visit www.ncsc.gov.uk/guidance/10-steps-cyber-security or www.actionfraud.police.uk for further information on cyber security threats and best practice.

END OF HMRC UPDATE