Engaging digitally with HM revenue and customs (HMRC)

As a business owner, keeping up to date with the ever evolving Making Tax Digital (MTD) landscape isn’t always easy. There have been many changes to the format and timeline in arriving at the current iteration, where all VAT registered businesses must comply with MTD for filing of their VAT returns.

Self-assessment for individuals with business and/or property income over £50,000 is scheduled to come under MTD from 5 April 2026, with the income threshold reducing to £30,000 from 5 April 2027. MTD for self-assessment will likely entail the quarterly filing of summary trading returns via cloud accounting software, followed by an annual confirmation which largely resembles the current tax return process.

Regardless of the legislation, and the deadlines that come and go, there remain good reasons why engaging with us and HMRC digitally can be beneficial.

Under the wrapper of “modernising the UK’s tax administration framework” HMRC’s core focuses are: MTD, a single customer account, real-time information, timely (re)payments, and improved standards in tax advice.

Whilst Making Tax Digital is the stick HMRC have used to drive the digitalisation of business accounting records, the real carrots are accessed through the single customer account; known historically as the Government Gateway, and now HMRC Online Services. You also cannot register for MTD without having an Online Services account, so legislation will drive you there eventually.

An individual Online Services account will be split between your personal tax account and/or business tax account. A company or organisation will only have a business tax account.

From your personal tax account, you are able to handle your non-business taxes and benefits. You can:

• manage your personal details
• view your Income Tax estimate and find out more about your tax code
• check how much Income Tax you paid last year
• claim a tax refund
• view your National Insurance record and State Pension forecast
• manage your tax credits
• view correspondence from HMRC and check the status of submitted forms

Your business tax account allows you to access all your business taxes in one place. This could include:

• Corporation tax
• PAYE for employers, including CIS
• Self-Assessment for partnerships or trusts, or Making Tax Digital for Income Tax
• VAT and VAT services, for example EC Sales List

Taking a deeper dive in to VAT, for example, you can view return deadlines, view submitted returns, check what you owe and make a payment, view payment history, track repayments, set up direct debits and a repayment bank account. You can also view your VAT certificate and update items on this such as your principal place of business address, VAT return dates and even cancel your VAT registration.

We are not suggesting that these are items you should be doing on your own. For us, the most important feature of the Online Services account, is that it is used to authorise us as your tax agent with HMRC. It is almost impossible for us to act as your accountant under MTD without you engaging with your Online Services account.

The authorisation allows us to communicate with HMRC on your behalf and to see a summary of the information available to you. This facilitates us in having more informed conversations with you and resolving HMRC queries in a timelier manner. It is also required so that we can submit VAT returns as your tax agent.

To back up the positives with hard data from taxpayers, HMRC recently presented at AccountEx highlighting some of their internal issues and the shifting trends of taxpayer engagement

• 138m taxpayers interact with HMRC digitally via webchat, online services, or app, whilst
• 54m taxpayers interact with HMRC via post or phone.
• HMRC’s target is to answer 85% of all telephone calls,
• In 2022 only 70% of telephone calls were answered, and
• 2/3 of all calls could have been dealt with online.
• Customer satisfaction for those engaging digitally with HMRC was 84%,
• Customer satisfaction for those engaging via telephone was only 62%, and
• The HMRC app has an average 4.8* review from 124k reviews.

If you would like assistance is creating your Online Services account, or tidying up old accounts and taxes, please do speak with your usual Albert Goodman point of contact. Alternatively, you can try HMRC’s webchat by searching: “HMRC online services helpdesk”.