HMRC’s October Digital Update

Oct 31, 2017

This month’s update features the latest news on Making Tax Digital, the new Trusts Registration Service and the Take-Five Stop Fraud campaign.

“Digital Services Update – October 2017

Making Tax Digital for Business (MTDfB)

We continue to work with volunteer agents and their clients on our pilot to test and develop the MTDfB service for income tax and national insurance. In future updates we will tell you how you and your clients can get involved. In order to get ready for MTDfB, volunteers will need compatible software. 
Ensuring your clients keep business records digitally is the most important step towards being ready for MTDfB. If you are not already doing this you’ll need to think about how and when to move your clients to digital record keeping. If you are already using practice software, you may want to speak to your supplier about when their products will be ready to support MTDfB.
Towards the end of this year we will start our work with software developers on technical testing for the MTDfB service for VAT.  In Spring 2018 we will begin to pilot the VAT service with a small number of VAT registered businesses and their Agents.  The pilot will expand in numbers and features in the lead up to April 2019.  From that point, VAT registered business over the VAT threshold must keep their business records digitally and provide their VAT return information to HMRC through MTDfB compatible software. 

You can find more information about MTDfB on  And you can watch a basic overview of MTDfB webinar here].

Agent access to services

A number of services continue to be tested by a small number of agents, with MTDfB compatible software. The services being user tested are:

  • creating an agent services account – this is a one off process that an agency will need to complete to enable the firm and its staff to access MTDfB services (and a range of other HMRC services as they are released. This includes the Trust Registration Service)
  • 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 third party software to do this

An authorisation service continues to be user tested which will allow an agency to send a digital invitation to a taxpayer they wish to represent in MTDfB. The client will be able to accept or reject the invitation using a secure online process.  

Agents who need to register trusts with the Trust Registration Service (TRS) will, as part of the TRS, need to create an Agent Services Account to access the TRS iForm. There is no requirement to link clients to their Agent Services Account.

Trust Registration Service  

The new TRS allows trustees to register their trust and complex estates online and provide information on the beneficial owners of the trust or estate. The new service was launched in July 2017 for trustees and replaces the 41G (Trust) paper form, which was withdrawn at the end of April 2017. This is now the only way that trusts and complex estates can obtain their SA Unique Taxpayer Reference.

The new TRS will be opened up to agents in October 2017, and as part of this digital service, agents will be taken through the steps to create an Agent Services account before they can register on behalf of trustees.

In this first year of TRS, there will be no penalty imposed where registration is completed after 5 October but before 5 December 2017. This is to allow sufficient time to complete the registration of a trust or complex estate, for SA and provide beneficial ownership information. Where the trust is already registered for SA, the trustees (or their agent) of either a UK or non-UK (express) trust that incur a UK tax liability, must provide beneficial ownership information about the trust, using the TRS, by 31 January after the end of tax year.

The new service will provide a single online service for trusts to comply with their registration obligations. The aim of the new service is to improve the processes around the administration of trusts, and allow HMRC to collect, hold and retrieve up to date information in a central electronic register.

The online TRS is currently available to UK based agencies. Overseas agencies who need to register a trust should contact the Trusts Helpline.

More information is available in the September Trusts & Estates Newsletter.

Making Tax Digital for Individuals (MTDfI)

Simple Assessment  

Simple Assessment was introduced in September 2017.  This is an important part of our plan to make the tax system simpler for individual customers, particularly Self-Assessment customers.  

With greater use of existing data, HMRC can now find the information for some of those customers elsewhere without needing them to complete a tax return for 2016-17:

Initially this will include:

·        PAYE customers who have underpaid tax in 2016-17 year but cannot have their tax collected through their tax code

·        new state pensioners whose state pension is more than the personal tax allowance in the tax year 2016 to 2017 and the tax due can’t be collected via their tax code. 

Customers will receive a Simple Assessment letter with a request for payment, which they can make online through their Personal Tax Account. The letter will give details of the tax due and the information used to calculate it.

If a customer’s circumstances have changed from the information in the letter, then they must notify us within 60 days with the amended figures and any evidence.  There is an appeals process for any disputes that cannot be resolved through this.

Cyber Security

Communications Update

From 18 October Cyber Aware is encouraging people to have a #techfree15 (minutes) and use this time to install software and app updates whilst they do something such as exercise, meditation, cooking or simply reading a book. We encourage you to promote their messages on Twitter.

Take Five:

The new ‘Take Five-Stop Fraud’ campaign, led by Financial Fraud Action UK (FFA UK) and Her Majesty’s Government backed by the banking sector successfully launched during October. Campaign collateral is available to download from the Take Five website. The campaign is running across a number of channels with a video on demand available on Sky Go, C4 on demand and ITV player. Radio adverts have been running on national channels including Magic and LBC. A number of national publications are also running advertorials on Take Five.”