June’s update features the latest on Making Tax Digital and cyber security

Making Tax Digital for Business (MTDfB)

Preparations for MTDfB are continuing, with pilots underway for both VAT and Income Tax.

HMRC’s recent reprioritisation of projects is nothing new. It’ll allow us to free up resources to support EU Exit while maintaining our day-to-day core business of bringing in the revenues our vital public services depend on. We’ve been very open publically about the impact of these changes since Autumn 2017.

We continue to work closely with software developers on both MTD pilots, in testing the technology and the user experience.

MTD Agent Services and Income Tax Pilot

As we reported last month, agents can now set up an agent services account and sign up to use software to send Income Tax updates to HMRC on behalf of their clients. Currently the pilot is open to self-employed businesses with income from one business, and landlords with income from property. We will advise you via the usual channels when the pilot is open to all self-employed business.

In summary, agent firms can now

• Create an agent services account (accessed from GOV.UK)
• Link existing Self-Assessment (SA) and VAT client relationships to their agent services account (accessed from their agent firms’ agent services account homepage)
• Sign up SA clients to MTD for Income Tax quarterly reporting (accessed from GOV.UK)
• Link their agency MTD-compatible software to HMRC (accessed through their software)
• Submit updates through their agency MTD-compatible software on behalf of a client
• View MTD data and calculations on behalf of a client through software

Additionally, an agent can now access a digital authorisation service from their agent services account for a new MTD SA client (a digital 64–8 for MTDfB). Their new client can digitally confirm this authorisation to HMRC.

The existing paper 64–8 process can still be used for Self-Assessment, and any new clients added to an agency’s Government Gateway credential in this way will be recognised for MTD SA.

Agents will soon be able to manage users within their agent services account. This function will allow agent firms to create additional Government Gateway IDs to allow multiple agents within the firm to access administrative services available through the agent services account, such as signing clients up to MTD VAT or registering Trusts.

To note:

A number of software developers are carrying out trials with their existing agent customers to trial their MTD product for Income Tax – please contact your software provider if you are interested.

In response to some of the questions raised through recent webinars, we are developing additional guidance for Agents on preparing for MTD which will be available through an extended Agent Update in June.

We also ran more MTD webinars on 21 and 22 May with a substantial part of the session on agent services account. Recordings of our MTD l webinars are available on GOV.UK

VAT Pilot

We continue to test this service with invited volunteers. Currently we are focusing on VAT registered businesses with the most straightforward affairs. We will let you know when the pilot is extended to include other VAT registered businesses.

You will be able to sign up your clients to the pilot before April 2019 when it becomes mandatory for those above the VAT threshold to keep digital records for VAT and send their VAT returns through MTD using software.

Cyber Security

Please see our recent press notice highlighting our success cyberspace:

HMRC saves public £2.4M by stopping fraudsters

HMRC has revealed today that it has saved the public over £2.4m by tackling fraudsters that trick the public into using premium rate phone numbers for services that HMRC provide for free.

Scammers create websites that look similar to HMRC’s official site and then direct the public to call numbers with extortionate costs in comparison to the low cost and no cost service HMRC provides. These sites promote non-HMRC premium rate phone numbers as a means of reaching HMRC but these are merely call forwarding services which connect callers to HMRC at a significant price. HMRC’s own 0300 numbers are mostly free or charged at the national landline rate. In other cases, sites charge for forwarding information to HMRC which can be provided free of charge through hmrc.GOV.UK

HMRC has successfully challenged the ownership of these websites, masquerading as official websites, and taken them out of the hands of cheats. Analysis has shown that had HMRC not taken this action then the public would have lost £2.4m to these phone scams.

Treasury Minister, Mel Stride MP the Financial Secretary to the Treasury said:

“We know that HMRC is the most spoofed government brand as criminals try to take advantage of the fact that everyone has some involvement with the tax authority. In this particular case, scammers try to dupe the public into paying large sums for services that are available for free or low cost.”

“This is a brazen con, charging premium rates whilst simply redirecting calls to the real HMRC numbers that are available at low or no cost. It is a testament to the hard work of HMRC that they have prevented criminals extracting £2.4m from the public.”

“The public should go direct to GOV.UK to obtain genuine HMRC contact numbers. These will not be premium rate numbers. People should be alert for sponsored adverts, websites charging for government services which would be expected to be free and those with disclaimers denying association with HMRC or government.”

Consumer Minister Andrew Griffiths MP said:

“Anyone can fall victim to scams and the cost can be devastating, so it’s great to see HMRC cracking down on these bogus websites and protecting the public’s purse.”

“This Scams Awareness Month I’m encouraging anyone who has fallen foul of false phone numbers to speak up, so we can stamp scams out.”

Check GOV.UK for information on how to avoid and report scams and recognise genuine HMRC contact.

END OF HMRC UPDATE