HMRC have published their Agent Update for January 2025. We have summarised the key content with links to our detailed guidance on the topics covered, including the classification of double cab pick-ups, a new R&D disclosure facility and the public service pensions remedy digital service.

Agent Update

Classification of Double Cab Pick-Ups (DCPUs)

From 6 April 2025, HMRC will no longer apply the one-tonne payload test to determine whether a Double Cab Pick-Up (DCPU) is primarily suited for carrying goods.

As a result, it is likely that most DCPUs will be classified as cars for employment tax and capital allowance purposes thereafter. 

Benefits-In-Kind

  • From 6 April 2025, a vehicle must be assessed as a whole when it is made available in order to determine whether the vehicle construction has a primary suitability.
    • Where a vehicle cannot clearly be identified as being predominantly suited for carrying goods, the default should be that the vehicles are cars. This is likely to be the case with many DCPUs. 
  • HMRC has published guidance at EIM23151. This also provides information on the transitional arrangements for DCPUs leased, purchased or ordered before 6 April 2025.

Capital allowances

  • For capital allowances, the change in treatment of DCPUs applies for expenditure incurred on or after 1 April 2025 for Corporation Tax and 6 April 2025 for Income Tax.
  • New guidance is available at CA23511. This includes transitional arrangements in place for contracts entered into before 1 April 2025 and 6 April 2025 relating to expenditure incurred before 1 October 2025.

Business profits

See Company carsCars, Vans & Other 4 wheel vehicles: Allowances and Cash or accruals accounting toolkit

New Research and Development (R&D) Disclosure Facility

A new disclosure facility for overclaimed R&D tax relief went live on 31 December 2024.

  • Taxpayers and agents will self-serve any tax, tax credit repayments, interest and penalties due. Completion of the form includes uploading computations, explanations and submitting a letter of offer.
    • HMRC will review the disclosure and if the offer is satisfactory a letter of acceptance issued.
    • As the facility is voluntary, any penalties will usually be accepted as ‘unprompted’ meaning a lesser penalty than awaiting HMRC intervention.
  • The disclosure facility is only for R&D claims that are out of time to amend using the Company Tax Return where inaccuracies are not deliberate. 
    • Any deliberate inaccuracies will be re-directed to the Contractual Disclosure Facility.
  • There is no requirement to notify of the intention to make a disclosure.

See R&D Disclosure Service

R&D claimant support packages

HMRC are emailing guidance packages to taxpayers following the submission of R&D Claim Notification and Additional Information Forms (AIF).

  • Emails will be sent on a trial basis to a random selection of taxpayers.
  • The emails will differ depending on which form is being submitted but will include:
    • Links to online guidance, or details to search on the GOV.UK website.
    • Links to HMRC YouTube videos.
    • Links to the new R&D Disclosure Facility.
    • The email address to contact if the taxpayer was unaware the forms were being submitted on behalf of the company.
  • There is no requirement to respond to the emails and they will never ask for personal or financial information.

See Research & Development Tax Reliefs

New online iForm for PAYE (P87) employment expenses

From 20 December 2024, HMRC has reimplemented the ability to claim tax relief on employment expenses through an online form.

  • There was a temporary switch to a paper and post route from 14 October 2024 to respond to a growing tax risk driven by ineligible claims for employment expenses.
  • Individuals who wish to claim tax relief for employment expenses can now submit their claim and supporting evidence using a new online iForm.
  • See HMRC's updated issue briefing on evidence required to claim PAYE expenses.
  • Agents representing individuals will still need to submit their claims through the usual paper-based submission route.

See Annual expenses for employees: How to claim

Self Assessment tax return deadline draws near

The 2023-24 Self Assessment filing and payment deadline is 31 January 2025. HMRC are highlighting three online resources: 

  • The Self Assessment online service for agents: file your clients' tax returns, view their statements and payments, get their PAYE coding notice and update their contact details.
  • The Income Record Viewer (IRV): access to your client’s pay, tax, employment history, pension (private and state) and tax codes.
  • Check HMRC's performance and service levels for post and online services. See when you might expect a response from HMRC and check processing dates for Self Assessment refunds, tax return amendments, registering and more.

Agent access to the public service pensions remedy digital service

Background

  • In 2015, public service pension reforms introduced career average schemes, moving most public service pension scheme members into the new schemes on 1 April 2015.
  • Those within 10 years of retirement were given transitional protection and remained in their legacy schemes.
  • In 2018, the Court of Appeal found that this transitional protection gave rise to direct age discrimination.
  • The government acknowledged this applied to all Public Service Pension Schemes (PSPS) reforms and committed to remedying this discrimination, the Public Service Pension Remedy (known as McCloud).
  • The remedy moves all impacted members to their legacy pension scheme for the remedy period 1 April 2015 to 31 March 2022.
  • As a result, members' accrual in their pensions for the remedy period will have changed and this may impact the tax they already paid or create new tax liabilities.
  • These new or different liabilities can be managed through the calculate your public pension service adjustment tool.

Agents dealing with this calculation on behalf of their clients should:

  • Use the calculate your pension service adjustment service to check your client’s tax position.
  • Download or print the information at the end of the service.
  • Request a form (if you do not have one) to report any changes by emailing This email address is being protected from spambots. You need JavaScript enabled to view it. with ‘Agent form’ in the subject line.
  • Use the information from the service to complete the form.

You should email HMRCThis email address is being protected from spambots. You need JavaScript enabled to view it. with:

  1. Information from the service.
  2. The completed form.
  3. Written authorisation from your client to act on their behalf.

You will need to agree to correspond with HMRC by email.

See Pensions: Tax rules and planning

Changes to repayment processing when agents become insolvent

HMRC have changed their handling of repayment requests when an insolvent agent is shown on a PAYE repayment claim as the nominee to receive repayments on behalf of the taxpayer. 

  • Repayments due to clients of insolvent agents will be paid directly to the client. This is to protect taxpayers and minimise delays.
  • This change applies to repayments for:
    • Marriage allowance.
    • Income tax deducted from savings and investments (R40).
    • Employment expenses (P87).
  • HMRC will announce when this process extends to other types of repayments.

Safety and Security declaration requirements: 31 January 2025

From 31 January 2025, all EU imports into Great Britain will require Safety and Security declarations.

  • You can find a full list of countries this will apply to, on the making an entry summary declaration page on GOV.UK.
  • Hauliers or carriers are legally responsible for submitting Safety and Security declarations.
  • HMRC have published detailed information on the steps you can take to prepare.
  • Updated information on where liability sits for different transport modes used for the import and export of goods into Great Britain can be found on GOV.UK.
  • If you are not ready to submit Safety and Security declarations, speak to your supply chains now to check who is responsible and agree on how this will be managed.
  • If you do not submit Safety and Security declarations from 31 January 2025, your goods could be held for unnecessary checks and you could be issued with a financial penalty.

Making Tax Digital for Income Tax events

HMRC is hosting a series of Making Tax Digital (MTD) for Income Tax events at HMRC offices across the UK this year.

  • You are welcome to attend one of these sessions to help you prepare for when MTD for Income Tax becomes a legal requirement in April 2026.
  • Registration is now open for the following events, which will each take place from 11 am to 3 pm:
    • Monday 24 February 2025: Leeds.
    • Tuesday 4 March 2025: Belfast.
    • Thursday 27 March 2025: Edinburgh.
  • Spaces are limited. If you are interested in attending, email This email address is being protected from spambots. You need JavaScript enabled to view it. and tell HMRC which event you would like to attend. By emailing HMRC, you consent to being contacted before, during, and after the event. 

Tax agents handbook

The new tax agents handbook is now live.

  • This is a redesign of the existing tax agents' and advisers' guidance collection, presenting information about authorisations, registering for services, contacting HMRC, and other guidance and support.
  • HMRC are inviting feedback and suggestions via a short survey.

Contact

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

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

  • Register you as an agent to use HMRC Online Services.
  • Process an application for authority to act on behalf of a client.

Manuals

Check the latest updates to HMRC manuals or subscribe to the automatic notification of changes.

External link

Agent Update 127

Squirrel advert

Loving our content? 😍
Sign up Now!
For free tax news, cases,
discounts & special tax briefings

We hope you are enjoying this amazing Practical Tax Database here at www.rossmartin.co.uk.

 

.