Agent Update: August 2022 - www.rossmartin.co.uk

HMRC have issued their Agent Update for August 2022. We have summarised the key content for you with links to our detailed guidance on the topics covered.

Technical updates and reminders

Update on UK implementation of global tax reform

In October 2021, 137 countries agreed upon the OECD's reform of international tax using a two-pillar solution.
Pillar 1 will come into force in 2024. The UK will start preparations for implementing the rules once they have been finalised.
Following a consultation, it was announced that the new global minimum tax rate (pillar 2) will be introduced for large Multi-National Enterprises (MNEs) for accounting periods beginning on or after 31 December 2023. This is a delay from the original start date of Spring 2023 due to the feedback received that businesses did not feel that they would be ready in time.
- Draft legislation was published on 20 July 2022 and is open for consultation until 14 September 2022.
- It is intended that final legislation will be included in the Finance Bill 2022-23.

See: UK delays global minimum tax rate

Tax avoidance - don't get caught out

HMRC's 'Tax avoidance - don't get caught out' campaign is aimed at helping contractors spot the signs of tax avoidance, as well as understanding the financial risks and how to check their pay to prevent unexpected tax bills.
Agents are asked to keep sharing the campaign messages with their clients.

Banks not accepting payable orders

There has been an increase in requests to cancel payable orders for Corporation Tax repayments as banks are not accepting them. Clients are advised to choose BACS payments and include these details on the CT600 for the quickest and easiest repayment method.

Correction to article published in Agent Update 96 - First full payment submission for new starters

Incorrect guidance was published in Agent Update 96 regarding what to do when receiving a late P45.
The correct guidance has been published stressing the importance of using the correct employee address and postcode. An incorrect address may cause correspondence to be misdirected or prevent future claims from being processed.

See: PAYE: Starter checklist new employee 2022-23

New approach to VAT compliance for overseas-based traders using online marketplaces

From September 2022, HMRC will be issuing VAT assessments for traders instead of information requests, where they believe they already hold enough information to show the return may be inaccurate.
The assessments will go to the UK address, which for overseas traders may belong to their agent.
The assessments will be for return periods up to December 2021 (the rules changed in January 2021).
If an assessment is not paid or a Time to Pay agreement is put in place, a Joint and Several Liability Notice will be issued to the online marketplace where they trade. As a result, the marketplace may choose to exclude the trader until the Notice is withdrawn.

See: Online marketplaces: Selling goods in the UK

Capital Gains Tax on UK Property Account

HMRC's manual page on the interaction between the CGT UK Property return and the Self-Assessment (SA) return has been amended to make it easier to follow. The property return must be made before the SA return even if late. If the SA return is made first, the property return must be filed in a paper format.

See: 60-day CGT returns required despite reporting under Self Assessment

Making Tax Digital (MTD)

Agent Services Account (ASA)

Testing will begin soon on allowing agents to control who in their agency can access client records. Permissions will be able to be set by the administrator.
Making VAT Digital services will no longer be able to be viewed from the ASA, as all VAT-registered businesses have been mandated to sign up to MTD for keeping records and filing returns.

See: Making Tax Digital: VAT

Customer Pilot

Currently, taxpayers who have an accounting period aligning to the tax year with certain income streams can sign up for the MTD for Income Tax pilot. See Making Tax Digital: Survival guide (for the self-employed & landlords)
The pilot is to be expanded later this year for taxpayers who file for the following: pension contributions, CIS, student loans, additional Self Assesment (SA 101), foreign income from property, voluntary Class2 NICs, capital gains and marriage allowances.

See MTD: Income Tax Pilot Tool

Making Tax Digital (MTD)

Making Tax Digital for VAT: make sure your clients are signed up

All VAT-registered businesses should now be using MTD to keep digital records and submit tax returns to HMRC.
Even if they currently keep digital records, they must use MTD-compatible software to file their VAT returns.
If your client has not signed up to Making Tax Digital, they need to do so before they file their next VAT return, otherwise, they could receive a penalty.

See Making Tax Digital: VAT (subscriber guide)

HMRC Agent Services

The Trust Registration Service (TRS)

Deadlines for registering a trust with HMRC

The deadline for registering most trusts on the Trust Registration Service (TRS) is 1 September 2022.

Reporting a discrepancy in Trust Registration Service data

From September 2022, a Relevant Persons is required to report any discrepancies in TRS data to HMRC. Guidance on this has been published at TRSM70000.

Trust Data requests

From September 2022, HMRC may share information on the TRS in limited circumstances with some third parties following a Trust Data Request. Guidance has been published at TRSM60010.

How to report that there may be a disproportionate risk of harm to a beneficial owner of a trust if data is shared

HMRC will not share information on specific individuals if exemptions apply to them e.g. the individual:

Is under 18.
Lacks mental capacity.
Is at disproportionate risk of:
- Fraud, kidnapping blackmail, extortion, harassment, violence or intimidation as a result of releasing that information.

Trustees should email This email address is being protected from spambots. You need JavaScript enabled to view it. with 'Beneficial owners at risk of harm' in the subject line in order to apply for the exemption.

See Trust Registration Service

All Too Familiar: anti-money laundering staff training

HMRC have shared a link to a training film called 'All Too Familiar' as part of their anti-money laundering supervision. The material is available to members of the ICAEW and businesses registered with HMRC for anti-money laundering supervision. To access the material if you qualify, email This email address is being protected from spambots. You need JavaScript enabled to view it. with your registration number.

Moving to the Customs Declaration Service by 30 September 2022

The Customs Declaration Service is becoming the UK’s single customs platform and will replace the old Customs Handling of Import and Export Freight (CHIEF) system.

After 30 September 2022, businesses will no longer be able to make import declarations on CHIEF.
From 1 October 2022, to continue importing they will need to make their import declarations on the Customs Declaration Service instead.
To move across customers should follow the trader checklist, it takes several weeks to complete the process.

Customs agents register

The register helps businesses look for an agent to help with declarations. If you would like to be added to the register as a customs agent, email This email address is being protected from spambots. You need JavaScript enabled to view it..

Annual Investment Allowance (AIA) and loans to participators - update

The Corporation Tax Service is being updated so that returns claiming the AIA in excess of £200,000 or including s.455 loans using the new rate of 33.75%, will be able to be submitted from 16 September 2022.

Changes to the CT600L supplementary page from 1 April 2022 - update

CT600L issue were reported in Agent Update 95 for those claiming R&D credits in the tax return. These issues will be resolved from 16 September 2022. Before this, paper returns will be accepted where there is an urgent need to file.

PAYE for agents' online service

All agents enrolled for Employers PAYE online for agents can now opt-in to see liability and payment data for their clients.

HMRC Repayment Agents consultation

In June 2022 HMRC launched a consultation 'Raising standards in tax advice: Protecting customers claiming tax repayments' to consider ways to better protect taxpayers from Repayment Agents who make routine tax claims on people’s behalf, but can take up to half, or even more, of the payment. HMRC are keen to hear the views of all tax agents.
The consultation ends on 14 September 2022.

Tax agent toolkits

HMRC have many tax agent toolkits available for you to download and use designed to address the most common errors seen from previous years.

Contact

Complain about HMRC: To make a complaint to HMRC on behalf of your client you must be appointed as their tax advisor.

Where’s My Reply? for tax agents: Find out when you can expect to get a reply from HMRC to a query or request you have made. There is also a dedicated service for tax agents to: