News

The latest MTD agent update is now available.

HMRC’s latest schedule of webinars is now available for booking with upcoming webinars focused on the off-payroll working rules. These webinars are designed to provide information, guidance and tips on tax issues. Spaces are limited, so take a look now and save your place. If you have any questions, please send them to team.agentengagement@hmrc.gov.uk prior to the webinar, including the title of the webinar in the ‘Subject’ line of your email. HMRC will answer as many as possible on the day. Off-payroll working rules from April 2021: Status Determinations and Disagreements: choose a date and time This webinar explains what Status Determination Statements (SDS) are, the off-payroll working rules, and how to deal with disagreements following the status determination. Off-payroll working rules from April 2021: Contractors: choose a date and time This webinar gives an overview of the changes to the off-payroll working rules which come into effect on 6 April‌‌‌ ‌2021. It is specifically designed to help contractors understand what these changes will mean for them. Off-payroll working rules from April 2021: choose a date and time This webinar gives an update on changes to the off-payroll working rules (IR35) from April 2021 for the public sector and medium and large sized organisations. Off-payroll working rules 2021: international matters: choose a date and time This webinar explains how the off-payroll working rules interact with international and overseas issues. Off-Payroll Working Rules from April 2021: Engagement: choose a date and time This webinar looks at different types of engagements and explains when the off-payroll working rules apply and whose responsibility it is to consider them. Off-payroll working rules from April 2021: Fee-payer responsibilities: choose a date and time This webinar looks at fee-payers responsibilities under the off-payroll working rules including: who fee-payers are and their responsibilities; qualifying persons; deemed employers; and  how to work out the deemed direct payment. Making Tax Digital – digital links: choose a date and time Making Tax Digital businesses need to have digital links in place for their first VAT return period starting on or after 1‌‌‌ ‌April 2021. Sign up for one of HMRC’s webinars where digital links will be fully explained and you can learn how to meet the appropriate requirements.

Read the latest on Making Tax Digital in the most recent update from HMRC for February 2021.

As covered in yesterday's Chartered Accountants Tax News, over the weekend and until yesterday, HMRC was undertaking scheduled maintenance to the Making Tax Digital ("MTD") for VAT service. HMRC has today contacted us to advise that following this, an issue has been identified that is impacting the ability of some MTD for VAT taxpayers to submit a VAT return. HMRC is working to resolve this issue as soon as possible. In order to enable a fix to be delivered, HMRC has shuttered (i.e. temporarily halted) the ‘Return Submission’ element of MTD for VAT. As a result, it is currently not possible for taxpayers or agents to submit a VAT return through the MTD service. HMRC has advised us that all other elements of the VAT service (such as sign-up and payment) remain open. There is no interruption to applications for the VAT deferral new payment scheme. The MTD for Income Tax Self Assessment service is unaffected. HMRC expects the full service to return on the morning of Thursday 18th March. If this situation changes, HMRC will advise accordingly.  

In its response to the consultation Making Tax Digital: Corporation Tax, the NI Tax Committee questions if HMRC has a case for introducing MTD for CT which is currently planned to be introduced no earlier than April 2026. The Committee also sets out that the complexity of UK corporation tax rules will present challenges in the context of MTD. These rules will become even more complex from April 2023 due to the recent Budget announcements. Overall, the Committee makes the following key points:- The case for introducing MTD for CT needs to be set out by HMRC in detail which should include a review of the impact of MTD for VAT in 2019/20 and 2020/21 on reducing the tax gap; The Office of Tax Simplification’s work on CT complexity should be taken forward in tandem with a defined roadmap for addressing CT complexity over the next five years; and The exemption from MTD for CT quarterly filing should be available to both companies paying CT in instalments and companies subject to statutory audit in the current accounting period which received an unqualified opinion in their previous accounting period.

HMRC’s Agent Services Account was recently enhanced. Two new information emails have now been deployed which went live in the last week of February meaning agents should now be seeing these. One will advise agents that an authorisation request for a client has not been responded to, and will expire in five days. The other advises that an authorisation request has expired after the twenty one day period.

The requirement to register a trust using the Trust Registration Service is being extended as part of the UK’s implementation of the Fifth Money Laundering Directive. HMRC has now published an overview of the changes including which further trusts will need to register by 10 March 2022. We have also been advised by HMRC that updates to the trust registration service cannot be saved and returned to at a later date. HMRC’s message on this reads as follows:- “Unlike the Registration element of the service, this is not a feature that we will be adding to the service when an update is required to a Trust record. Registration of a Trust involves providing a substantial amount of information to HMRC and there was a clear user need that agents/lead Trustees required a time period to be able to: view the service to understand what information was required; contact other people, or organisations involved in the trust, to ascertain information required by the register; and not lose the information input while doing the above. Throughout user research, we did not identify a user need that highlighted the “save and return” feature was required when updating the Trusts record.  The information captured as part of the registration is available to view/download in PDF format as part of the registration, or upon re-entry to the service to update the Trust record. This provides the opportunity for an Agent/Lead Trustee to view the information submitted and determine which information, if any, needs to be amended. In addition, research highlighted that when changes were to be made to a Trust record, they would be minimal and therefore would be done in one session.  The user need HMRC must support is for agents/lead trustees to be able to notify HMRC that there has either been no change, a change or to close the trust, and this need has been met.  Whilst we recognise that some agents may have internal processes to handle the updating of a trust’s details, HMRC services are not designed to support those processes since they may be different for each user.”

Readers are reminded that the digital links soft landing period for Making Tax Digital for VAT ends next month on 1 April 2021 after its extension from April 2020 due to the pandemic. More information is available in the VAT Notice.

Do you use HMRC online services? Don’t be caught out by the planned downtime to some services. HMRC are warning about the non-availability of specific services on the HMRC website, a range of services are impacted. Check the relevant page for information on planned downtime. At present specific various MTD for VAT services are affected (see below). HMRC is currently undertaking scheduled maintenance to make a number of iterative enhancements to the functionality of the MTD for VAT service. As a result of this maintenance, the following MTD VAT services are currently unavailable until 5pm Monday 15th March 2021: sign up for the service; submit returns; ·view previous submissions and payment details; set up new or cancel and amend existing direct debits; review and update any business detail; and access agent services. The MTD for income tax service is not affected.

Read the latest on Making Tax Digital in the most recent update from HMRC for December 2020.

By way of reminder, the Institute is developing its response to the consultation on Making Tax Digital for Corporation Tax. This is your last chance to let us know your views on this important consultation. Please contact Leontia Doran with your feedback by close of business today Monday 22 February.

The Institute is developing its response to the consultation on Making Tax Digital for Corporation Tax. We’d welcome your views on this important consultation. Please contact Leontia Doran with your feedback by Monday 22 February.

HMRC are making a change this week to the home page of the Agent Services Account and want to give advance notice so that agents who may be filing VAT returns due on 7 February 2021 are aware of this change and are not taken by surprise. The changes may look cosmetic, moving from tile to concertina style and are in direct response to our user research and feedback. HMRC is hopeful that the changes will provide better ease of access to available information. HMRC would welcome any feedback you may have on this change.

Read the latest on Making Tax Digital in the most recent update from HMRC for December 2020.

In November 2020 HMRC launched their consultation on the design of Making Tax Digital (“MTD”) for Corporation Tax (“CT”) which this Institute will be responding to. The consultation closes on 5 March 2021. Last week HMRC launched a streamlined online version of the consultation for small businesses. Both the streamlined consultation and the full version can be accessed at: https://www.gov.uk/government/consultations/making-tax-digital-for-corporation-tax. The streamlined consultation is designed to provide a fast and accessible opportunity to review key summarised sections of the consultation and answer short questions to provide feedback on those areas. HMRC is seeking to work collaboratively on the design of MTD for CT and has launched the streamlined version to enable a wider range of interested parties to provide feedback on the consultation proposals. A number of virtual consultation events also continue to be held details of which, including registration details, are also available at the link above.

HMRC is currently undertaking scheduled maintenance to their digital services in order to deliver additional Making Tax Digital (“MTD”) for VAT functionality. The following MTD VAT services are unavailable from 4.30pm Saturday  14th November until 5pm Monday 16th November: submit returns; view your previous submissions and payment details; set up new or cancel and amend existing direct debits; and review and update any business details This planned release includes a new VAT Registration Service which is designed to provide taxpayers with an easy way to register and subscribe to VAT, obtain a VAT Registration Number (VRN), and sign-up to MTD. Do you use HMRC online services? Don’t be caught out by the planned downtime to some services. This and other planned maintenance and upgrade activities are shown on the HMRC service availability and issues page on GOV.UK.

Read the latest on Making Tax Digital and the Trust Registration Service in the latest update from HMRC for September 2020. 

Read the NI Tax Committee’s response to one of the most important consultations for many years in which HMRC explores potential options to regulate the UK tax profession. The key message of the Committee is that there should be no further regulation of qualified agents who are members of Professional Bodies with a strong, effective, and active regulatory function, such as members of Chartered Accountants Ireland.The Committee also made the following recommendations: -Under option A (which examines the potential for better use of HMRC’s powers), the Committee recommends that this is the option which should be pursued. HMRC should target rogue promoters more effectively with the comprehensive powers which they already have available to them after a review has been conducted of the collective efficiency of their use by HMRC – the Committee recommends that this review is conducted by Sir Amyas Morse; Further digitisation of the tax system should aim to remove administrative obstacles and unnecessary complexities for taxpayers but should be carried out in tandem with a defined roadmap for simplification of the UK tax system; and  The Office of Tax Simplification should be tasked with carrying out a review of income tax complexity in particular given the proposed extension of MTD to income tax from April 2023.  

HMRC has advised that it will be shortly be undertaking scheduled maintenance to HMRC’s various online services including Making Tax Digital for VAT and Income Tax Self-Assessment. This will take place between from 5pm, Friday 11 September until 9am, Monday 14 September. During this period, all MTD for VAT services will be unavailable, including:Agent service subscription;Agent authorisation;Submission of returns;Business tax account view and change;Direct debit; and Sign-up service. During this period, all MTD for Income Tax Self-Assessment services will be unavailable, including:  Agent service subscription;Agent authorisation; Submission of updated and returns;Sign up; andBusiness tax account viewer. This and other planned maintenance and upgrade activities are shown on the HMRC service availability and issues page on GOV.UK. HMRC is not making changes to individual MTD services over this period, so they will not look different or have any new functionality when they are returned on 14 September. HMRC apologises for any inconvenience this may cause.

Earlier this week HMRC published, jointly with HM Treasury, a five to ten-year vision for tax administration. As part of this, a future roadmap for Making Tax Digital (“MTD”) was also set out which will begin with extending MTD for VAT to VAT-registered businesses with turnover below the £85,000 VAT threshold from April 2022. The full message from HMRC is set out below. The Institute will continue to engage with HMRC on MTD and related matters to represent the views of our members.“I am writing to let you know that today we have published, jointly with HM Treasury, a 5 to 10-year vision for tax administration. As part of this, we have set out a future roadmap for Making Tax Digital. There are links to the vision document Building a trusted, modern tax administration system and the Written Ministerial Statement for Legislation Day at the end of this message. I am very keen to work collaboratively and transparently with you in the period ahead to take forward today’s announcements. There are links to the vision document Building a trusted, modern tax administration system and the Written Ministerial Statement for Legislation Day at the end of this message. I am very keen to work collaboratively and transparently with you in the period ahead to take forward today’s announcements. The full message from HMRC I am proud of how HMRC has responded to the COVID-19 pandemic by delivering support in record time for individuals, businesses and the self-employed. I am also very grateful to the many organisations who have helped us with this work, and supported us so effectively during this period. The pandemic has exposed the challenges that an out-dated tax administration system presents. A tax administration system which is more resilient and adaptable will offer greater flexibility and scope to provide targeted support to people and businesses in the face of a future national crisis. This period has emphasised the value of having access to real-time data and a more up-to-date overview of taxpayers’ financial position. Real-time data would have provided government with a more accurate picture of the trading and profit levels of the self-employed enabling support to be better targeted.The vision document sets out the next steps we can take to address these issues. These include the next stages of implementation of Making Tax Digital. The roadmap provides certainty so that businesses and agents can plan ahead. It allows for lead-times and piloting, and does not require action in the near future. Making Tax Digital will be:extended to VAT-registered businesses with turnover below the £85,000 VAT threshold from April 2022 – 30% of these businesses have already joined voluntarily; andintroduced for Income Tax Self-Assessment for businesses and landlords with income over £10,000 from April 2023.In addition, we will consult in the Autumn on the detail of extending Making Tax Digital to incorporated businesses with Corporate Tax obligations. We will also look at the long delay before the self-employed need to register and submit trading data. With earlier registration and information, it would have been possible to support those who recently set up in business, without exposing the scheme to fraud or organised criminal attack. This will form part of broader work to update the tax administration legislative framework.Over the summer, we will hold further discussions with businesses and their representatives to develop and assure the estimated implementation and administrative costs of complying with Making Tax Digital. Our initial estimate is that the average additional cost of complying with Making Tax Digital is about £20 a year for each business, with a transitional cost to make the change-over of about £175. This includes efficiency gains in tax administration, but not the wider productivity benefits of going digital. This is an average within a broad range, as costs will differ significantly from business to business. Free, basic software products are available. We will firm up our estimates in the autumn following further input from stakeholders. In March the Government published an assessment of the rollout of Making Tax Digital for VAT. Since 2019 over 1.4 million businesses have started using the service, submitting over 6 million returns. Evidence to date indicates that the anticipated benefits are being realised, with further evaluation planned. We have listened to feedback and are confident that today’s announcement provides businesses, landlords and agents with the certainty they need and adequate time to make the necessary preparations. We will gradually expand the pilot service for Income Tax to allow more businesses and landlords to test that the service is working as intended.We will shortly initiate discussions with stakeholders about the vision and next steps. We are keen to hear views from everyone with an interest, and will ensure our stakeholder forums have the opportunity to debate and shape the way the vision is developed. We will also be in touch to discuss our plans for Making Tax Digital in further detail. In the meantime, please do get in touch with the MTD team directly if you have any questions.I look forward to working closely with you on next steps, and am very grateful for all the contributions so many organisations, businesses and agents have already made to support the modernisation of tax administration.”