Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Keeping you informed
Introduction
Welcome to Agent Update 53. In this edition you can read about the two tax agent
toolkits that have recently been refreshed that might help as you start work on
submitting your clients’ end of year returns. We also include links to the latest
publications, consultation updates and compliance news. The Working Together
section has the latest updates on your issues and you can read about Deeds of
Assignment and forms P11D and S336 claims. We also have news about Agent
Services (formerly Agent Online Self Serve) and the extra help HMRC are offering
to help protect against fraud.
Consultations
Working Together
Tax
Developments and changes to legislation and allowances relating to UK tax.
HMRC service
Changes to HMRC service, upcoming HMRC events and guidance.
Consultations
Details of live consultations and response summaries.
Working Together
Latest updates from the partnership between HMRC and the six main agent
representative bodies.
If you would like an email reminder when each edition of Agent Update is published,
use the link below.
This month’s top articles
Sign up to receive email reminders of future issues of Agent Update
Agent Services (formerly Agent Online Self Serve)
If you have any queries about this publication please contact: Andria Barber, Editor
Read about the refreshed key priorities for 2016/2017 and how to take part in
a Talking Points digital meeting on Agent Services.
Changes to Employment Allowance
Read about the recent changes to Employment Allowance which came into effect
on 6 April 2016.
PAYE and NIC - Special reporting rules for agencies, employment
businesses and others
Read about the extra help available for business with the agency or employment
intermediary rules.
page 1 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Consultations
Working Together
Charities
Ten things about contractor loan schemes
Charities: detailed guidance notes
Ten things you need to know about tax avoidance schemes. These provide plain facts
about specific areas of tax avoidance.
These guidance notes outline how the tax system operates for charities.
Compliance
Advice provided to members by Road Hauliers Association about
certain tax/NIC avoidance schemes
HMRC is concerned that people and companies sold these schemes may not be
aware of the Managed Service Company legislation and could face tax, interest and
even penalties.
PAYE and NIC - Special reporting rules for agencies, employment
businesses and others
HMRC is launching extra help for business with the agency or employment
intermediary rules ahead of stepping up its compliance activity and applying the
penalty regime. Our specialist staff will talk you through the rules and explain the
special reporting requirements where staff are outside PAYE and NIC.
PAYE
Changes to Employment Allowance
From 6th April a limited company, where the director is the only employee who is
paid earnings above the secondary threshold, will no longer be eligible to claim the
Employment Allowance. From this date, the full amount of employer Class 1 National
Insurance will be due, without any Employment Allowance deductions.
A company which is no longer eligible to claim the allowance, must stop its
Employment Allowance claim. This can be done by sending an Employer Payment
Summary (EPS) confirming this as part of their regular payroll submissions. Payroll
software may also need to be updated to reflect this change. This will not affect
Employment Allowance claims for previous tax years.
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Spotlight 29: don't fall for it - misleading claims made by tax
avoidance scheme promoters
‘Spotlights’ warns you about certain tax avoidance schemes which you should be
aware of. These are just some of the schemes being widely offered to help those using
them to avoid tax.
page 2 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Consultations
Working Together
Changes in the year
Statutory Sick Pay (SSP)
If over the course of the year a company’s circumstances change, then they may
again be eligible for Employment Allowance. To be eligible, the company must either
increase the earnings of an existing employee to that of above the secondary threshold,
or employ an additional employee or director and pay them above the secondary
threshold (additional directors need to be paid over the annual secondary threshold,
which is £8,112 or pro rata in 2016-2017). In other words, the company must have an
employer Class 1 National Insurance liability for more than one earner. Where this is
the case, the Employment Allowance can be claimed for the whole tax year.
The Percentage Threshold Scheme (PTS), which allowed employers in certain
circumstances to reclaim any SSP they had paid to their employees, came to an end
on 5 April 2014.
Employment Allowance homepage
End of Easement for Micro Employers - on or before payroll reporting
The easement, introduced in April 2014 allowed employers who at 5 April 2014
employed less that 10 employees, to report their PAYE information ‘on or before’ the
last payday in the month rather than ‘on or before’ each payday, ended on 5 April
2016. All employers must now report their PAYE information ‘on or before’ each
payday unless they have a genuine reason for reporting late.
Further information about these changes, running payrolls, reporting to HMRC
(including exceptions).
Employers had until 5 April 2016 to recover any SSP paid in respect of periods up
to 5 April 2014. As this date has now passed employers should no longer make any
claims for recovery of SSP.
Pension Schemes
Minimum automatic enrolment contribution phasing date now
aligned with tax year
Your clients’ automatic enrolment duties include increasing the amounts they and
their staff pay into the pension over a number of years. This is known as ‘phasing’.
The date the minimum contributions were due to be increased has changed in order to
align with the tax year. So now, instead of contributions increasing from 2% to 5% in
October 2017, and from 5% to 8% in October 2018, they will now rise in April 2018
and 2019. Despite what some press articles have said, this is not a delay to automatic
enrolment, and employers’ staging dates will remain the same.
Visit The Pensions Regulator’s website for more information
Pension Schemes Newsletter 77
Newsletter 77 published by HMRC in March 2016 containing updates and guidance
on pension schemes.
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page 3 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Revenue and Customs Briefs
Revenue and Customs Brief 8 (2016): release by HM Revenue and
Customs of exporter information
This brief is intended to facilitate trade, boost UK growth and help exporters to
find new markets. It also explains how businesses can ‘opt-out’ from having their
information published. This opt-out will also now extend to the importer information
already published.
Revenue and Customs Brief 7 (2016): reminder of withdrawal of
the VAT Misdirection Extra Statutory Concession 3.5 in cases of VAT
liability change
This brief also gives notice that with effect from 1 August 2016 HMRC will no longer
routinely consider requests not to pursue the tax due.
Consultations
Working Together
Revenue and Customs Brief 5 (2016): Tonnage Tax - qualifying ships
and flagging
This brief explains if during financial year 2016 a company in Tonnage Tax starts to
operate a ship that is not registered in a European Union (EU) or European Economic
Area (EEA) member state, then they must carry out a ‘flagging test’ to determine
whether the ship qualifies for Tonnage Tax. The financial year 2016 is the year
beginning 1 April 2016.
VAT
Making a VAT Mini One Stop Shop (VAT MOSS) payment
HMRC has changed its bank. Please make sure you use the updated bank details
when making any payments relating to VAT MOSS returns.
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Revenue and Customs Brief 6 (2016): Registered Dealers in Controlled
Oil - plant and equipment hire companies
This brief provides information on changes to the registration requirements for plant
and equipment supplying companies who supply controlled oil as part of the hire or sale.
page 4 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Consultations
Working Together
Contact
HMRC service
Budget Mailing 2016
Agent Account Managers (AAMs) in HMRC
Between 11-15 April employers, who were not represented by an agent and had
not registered to receive an email alert, will have received a letter signposting them
to where they can find the latest edition of Employer Bulletin, Form P7X, which
explains tax codes to use following the budget, and also information on the Budget
and starting the new tax year.
HMRC has a UK-wide team of AAMs to help tax agents and advisers deal with the
department more effectively. Find out how to use the AAM service.
Employers need to register for email alerts
HMRC working with Tax Agents Blog
As the Department moves rapidly down the digital road it is becoming more apparent
that the days of paper mailings are numbered. It is important agents encourage
employers to register to receive email alerts so they are aware of the latest coding
changes and important information that is published on the Government Web pages.
The blog provides another channel to communicate about:
Where's My Reply?
The letter also gave guidance to prompt them to register for future alerts.
• joint HMRC and agent consultations
• improvements to HMRC services by working together
• news and updates that are agent specific
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 Where’s My Reply? for tax agents.
• HMRC’s Agent Strategy and the rollout of new digital services available for agents.
Manuals
Twitter
Recent Manual updates
Tweets cover information about HMRC and tax, including; news, publications,
information, consultations, speeches and publicity campaigns. Follow us on
Twitter@HMRCgovuk.
You can check the latest updates to HMRC manuals or subscribe to automatic
notification of changes.
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HMRC campaigns
Let Property Campaign has improved guidance for landlords
Do you have clients who are landlords? If so, you should draw their attention to the
Let Property Campaign's improved guidance about common tax mistakes made with
rental income. Please also see HMRC's Agents Property Toolkit for further guidance.
page 5 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Consultations
Working Together
Online
Publications
Future online services downtime
Employer Bulletin - April 2016
Information is available on any downtime that may affect the availability of HMRC’s
online services. Please note this is subject to change and confirmation by HMRC’s
IT provider.
Employer Bulletin 59 was published on 12 April. This contains topical and useful
information about PAYE processes and procedures. For employers to be informed
when it is available on the website they must register to receive the email alert.
Online security - stay safe online
Register to receive email alerts
HMRC continuously monitors systems and customer records to guard against
fraudulent activity, providing regular updates on scams we are aware of. If you have
any concerns regarding the authenticity of any emails received from HMRC,
see the online security pages for agents.
Employment-related securities bulletin No 22 (April 2016)
Online training material and useful resources for tax agents
and advisers
HMRC videos on YouTube, online learning modules, and live and pre-recorded
webinars are available for tax agents and advisers providing you with free help,
learning and support on topical subjects.
PAYE
HMRC supports Employment Intermediaries with guidance
Do you have clients who are employment intermediaries? If so please show them
HMRC's guidance on their reporting obligations and how to make sure workers tax
and National Insurance is paid correctly.
This bulletin gives information and updates about employment related securities
including tax-advantaged employee share schemes.
National Insurance services to Pensions Industry: Countdown Bulletin 15
This is an additional bulletin to give information about the new Guaranteed
Minimum Pension (GMP) Checker (formerly the GMP Micro-Service).
Toolkits
HMRC agent toolkits - a useful tool for helping agents
The HMRC Agent Toolkits are an online resource aimed mainly at tax agents.
However, some of them may also be useful to employers, in particular the following
which have recently been updated: Expenses & Benefits from Employment Toolkit
and National Insurance Contributions & Statutory Payments Toolkit.
section ends
Watch HMRC’s video which explains what an Employment Intermediary is.
page 6 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Consultations
Working Together
Current Consultations
Summary of responses
Fulfilment house due diligence scheme
Simplification of the tax and National Insurance treatment
of termination payments
This consultation is about the introduction in 2018 of a new online scheme for UK
fulfilment houses, which will set out standards of due diligence and record-keeping,
and introduce penalties for non-compliance. HMRC are seeking views on the
proposed scheme, to ensure that it addresses the abuse identified and minimises any
additional costs for businesses.
This consultation closes 30 June 2016.
Tobacco Illicit Trade Protocol - licensing of equipment and the
supply chain
A consultation on the control of tobacco manufacturing equipment and possible
licensing of those involved in the supply chain for tobacco products.
This consultation closes 20 May 2016.
Current Consultations
Agent Update 53 contains all new open consultations available when this issue was
being published, but please check for any that may have subsequently been issued.
Read details of the outcome and how HMRC plan to proceed.
Travel and subsistence framework: discussion paper
This response document follows the publication of the discussion paper in September
2015 that outlined a proposed travel and subsistence framework for consideration.
Company distributions
This document summarises the responses to the consultation and sets out the
government’s response.
Cash, tax evasion and the hidden economy: call for evidence
This document summarises responses from stakeholders to the government’s call
for evidence on cash, tax evasion and the hidden economy.
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page 7 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Consultations
Working Together
Update on Working Together (WT)
WT Open Issues Register
Working Together Team (WTT)
The PBs of the IOG agreed the following as priority 1 issues.
Working Together (WT) is a partnership between HMRC and the six main agent
representative bodies which looks for ways to improve HMRC operations for the
benefit of tax agents, their clients and HMRC. Members from a range of other
Representative Bodies including; AIA, CIMA, CIPFA, CIPP, CPAA, IAB, ICB, ICPA,
IFA, SPA, STEP and VATPG, also actively participate and contribute to WT. The
WTT maintains an issues register providing details of all widespread issues. These
issues are prioritised by the Professional Bodies (PB) on the Issues Overview Group
(IOG) and the highest priority ones are monitored by the Joint Initiative Steering
Group. The Specialist Agent Managers use the register to keep agents in WT Digital
meetings up to date with the latest information and news.
Digital Agent Engagement - Working Together Update
The Digital Working Together programme has continued at pace since the first
meeting, hosted by the South East Region, took place in September 2015. PB
representatives and HMRC have now jointly hosted 6 Digital Working Together
meetings to date, with the most recent having taken place on 8 April, hosted by the
South West Region. These meetings are an opportunity for agents and HMRC to
identify, discuss and ultimately resolve widespread issues affecting day to day work.
The discussion is supported by an Agent Digest, a shared document of existing and
potentially widespread issues, overseen by the IOG who meet with HMRC on a
quarterly basis. If you are interested in joining WT please contact your PB as shown
on page 12 or by using the Agent Engagement Team Mailbox. Agents who are not
members of a PB can also use this mailbox.
WT ref
Business area
Issue
WT050 WT226
Processing
P11D Expenses and associated S336 claims
WT054 Other
HMRC correspondence
WT218 Customer Contact Intelligent Telephony Automation system (ITA)
WT226 PAYE Individuals
PAYE coding (P2) not showing wk1/mth1 indicator
WT234 Self Assessment
SA reminders
WT237 Customer
Operations
Postal delays
WT238 Customer Contact Telephone delay on non- Agent Dedicated Lines
(ADL)
WT239 Self Assessment
Delays reported in repayments due to incorrect
signal set on client’s accounts
WT242 Online
Completing and saving HMRC online forms
WT050: Processing P11D and associated S336 Claims: The current measures being
introduced from April 2016 in connection with the benefits and expenses, will
address the processing of P11D/S336 claims.
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page 8 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Employee Benefits and Expenses - exemption for paid or reimbursed expenses
The February edition of Employer Bulletin included information for customers most
impacted by the new measures and those who previously submitted P9Ds.
Please also refer to the article published on page 11 of this edition of Agent Update
entitled Forms P11D and S336 claims.
WT054: HMRC Correspondence: WT has undertaken an in depth review of this
issue in respect of delays in issuing correspondence. The analysis shows that the issues
reported refer to historical problems. The PB representatives of IOG are considering
the next steps for this issue, taking into account any recent feedback.
WT218: Intelligent Telephony Automation System: HMRC guidance on contacting
HMRC was shared with the PBs of IOG who provided feedback that a more bespoke
guide for agents would be useful. The business are currently reviewing the guide to
consider whether any further steps can be taken.
WT226: PAYE coding P2 not showing wk1/mth1 indicator: Agents do not receive
a copy of the client’s P2 and rely on the information provided by the client. This
can lead to confusion and discrepancies in the client’s liability when it is not known
when an emergency or cumulative coding has been applied. HMRC acknowledges
that although this issue affects a small percentage of the whole customer base, it still
creates a large amount of contact.
The IOG have highlighted recent changes to the paper P2. The business have advised
that customer insight was utilised during the recent redesign of the P2. The current
design shows an ‘X’ instead of the previous W1/M1 and the accompanying note
explains that the tax position will be reviewed later.
The IOG are considering the response from the business to decide the next
appropriate action.
Consultations
Working Together
WT234: SA Reminder letters were issued to unrepresented customers only: Following
feedback from the PB that more information was required an article was published on
page 12 of Agent Update 51 regarding SA reminders. HMRC continues to work with
the PB’s on this issue.
WT237: Postal Delays: The delays associated with this issue link to the telephone and
repayment delay issues highlighted below. The IOG are considering any recent feedback
received from members to suggest postal delay continues to be a widespread issue.
WT238: Telephone Delay for non-Agent Dedicated Lines (ADL): The March 2016
budget announcements regarding investment into HMRC customer service and the
planned improvements is being taken forward with the Customer Service Standards
Working Group. This working group reports to the Joint Initiative Steering Group
(JISG) & IOG.
WT239: Delays reported in repayments due to incorrect signal set on client’s
accounts: The business have reported that during 2015 there were periods when
HMRC customer service levels were not where they needed to be. Since then HMRC
has taken major steps to improve its performance, including recruiting 3,000 new
staff into customer service roles.
HMRC have also delivered its biggest-ever training programme to build customer
support teams that can move across a wide range of work according to customer
demand. By the end of December 1,600 existing staff were trained to cover a wider
range of work, which includes bringing HMRC SA repayment work up to date.
Because of these changes, HMRC customer service levels have now improved and
your client should receive a better level of service going forward.
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page 9 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
WT242: Completing and saving HMRC online forms: PB representatives on the
Virtual Communications Group have identified two areas where online forms are
causing their members problems:
•Structured emails - web pages that have to be completed in one go with no ability
to save when partially completed.
•Intelligent PDFs - cannot save partially completed forms.
These issues are being looked at by the business to consider possible solutions.
The IOG members have provided details of the top 10 iForms used by the PB and
their members. The previous edition of Agent Update requested feedback. Agents
were also given the opportunity to provide feedback via the WT Digital meetings.
All feedback received has been passed to the business for consideration.
WT Closed Issues
WT always do all they can to ensure that an issue has been fully addressed before
closing it and part of the role of the IOG is to ensure that issues are not closed
prematurely. However we recognise that sometimes we may close an issue and agents
may still experience problems. WT are always prepared to re-open a closed issue
provided agents can supply the evidence that the issue is continuing to cause problems.
There have been no closed issues to report since Agent Update 52.
Form P800
WT agents raised an issue regarding the design of the P800 form.
The P800 calculation consolidates all pension income into one sum making it difficult
to check where there is more than one pension source.
Consultations
Working Together
Issue Resolution Service - Deeds of Assignment
An Agent Account Manager (AAM) noticed an increase in issues submitted and
identified a significant proportion related to the rejection of customised repayment
claim forms, also known as Deeds of Assignment (DOA).
The AAM team liaised with the Specialist Agent Managers and PT Operations and
established more agents had been affected. Due to the volume of rejected cases they
initiated the publication of urgent guidance to address the issue and arranged for the
rejected claims to be reworked immediately.
The AAM team recently issued a Tax Agent Blog highlighting the published guidance
and included tips to help avoid further claims being rejected.
Top issues raised with the AAMs
The top five issues dealt with by the AAMs in March 2016 were:
•Agent Maintainer - Deeds of Assignment (DOA) rejection/missing 64-8 form
•PAYE Correspondence - Progress chasing repayment requests made via DOA/
missing letters
•SA Repayment - Progress chasing repayment requests made via return/online/post
•SA Correspondence - Progress chasing letters/forms not processed
•PAYE Repayment - Progress chasing repayment requests made via return/online/post.
Register to use the Agent Account Manager service.
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A suggestion that this should include a space on the form to breakdown Pension
figures has been considered by the business resulting in a redesign.
page 10 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Consultations
Working Together
Forms P11D and S336 claims
HMRC offers customers extra help to protect against fraud
The submission of a S336 claim is the responsibility of the individual employee but
when this is attached to the original paper P11D and submitted by an employer on
behalf of an employee, the S336 claim and the P11D should be sent to:
Self Assessment customers can now take advantage of HMRC’s ‘2 Step Verification’
when logging into their Tax Account with effect from 29th March 2016. Customers
can link their mobile phone with their log-in details if they wish and help protect their
account against fraud from March 2016.
HM Revenue & Customs (NIC&EO)
Room BP2101
Tynemouth House
Benton Park View
Longbenton
Newcastle upon Tyne
NE98 1ZZ.
On receipt, HMRC will keep the S336 claim attached to the P11D to ensure the two
are processed together at the same time.
Where a S336 claim is submitted separately on a form P87, form P810 or in letter
format and is not attached to an original P11D, it should be clearly headed S336
CLAIM and have a copy of the P11D attached if possible, (the P11D should be noted
as a copy). This will help HMRC to identify these cases as quickly as possible and
send them for processing.
Then, in future when they log in, HMRC will text them a code which they will enter
to gain access to their Tax Account. If customers lose their phone or change number,
2 Step Verification can be deactivated by ringing the Online Services Helpdesk.
Agent Services (formerly Agent Online Self Serve)
Agent Online Self Serve (AOSS) has been renamed Agent Services (AS). The project
has refreshed its key priorities for 2016/17 and this name better reflects the scope
of what HMRC aims to deliver for agents within this programme of work.
The four priority delivery areas for AS are:
On-boarding - enable agents to access services and features contained in the Personal
and the Business tax account using third party software which will give them the
ability to see and do what their clients are able to do through their tax account.
The S336 claim with the copy of the P11D attached should be sent to:
Subscription - a process that will allow us to collect data about a tax agency as part
of HMRC’s Agent Strategy.
Pay As You Earn and Self-Assessment HM Revenue & Customs BX9 1AS.
Authorisation - enhance the existing online agent authorisation (OAA) service.
Expenses exemption replaces dispensations from 6 April 2016
Inbound Secure Messaging - work to understand what information agents want
to send to HMRC and explore the digital solutions that can be used to cater for
this requirement.
As explained in February’s Employer Bulletin, from April 2016 a change in legislation
means dispensation will cease to exist. Employers who wish to pay or reimburse
employees expenses after 5 April 2016 will be able to do so without deducting tax
or NICs from those payments, where the expense would qualify for a deduction and
meet the conditions for payment.
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page 11 of 12
Agent Update
Agents and HMRC working together April 2016 - May 2016 - Issue 53
Welcome
Tax
HMRC service
Consultations
Working Together
A Talking Points digital meeting on AS is taking place at 12:00-13:00 on 19 May
2016. If you are not already registered for Agent Update, and the Tax Agent Blog,
please do so. This will ensure you receive details of how to register for Talking Points
digital meetings, and get regular updates on AS and other items of interest to agents.
Working Together Contact information for Professional
and Representative Bodies
The survey to recruit agent volunteers to participate in the trial of the Agent Services
PAYE liabilities and payments beta service has now closed. A small number of agents
are currently being recruited into the beta service, although this is by the trial of an
automated system. This identifies a random selection of eligible agents, (those with
under 200 clients in any one tax regime) logging on to HMRC online services each
day. Agents joining AS do keep access to the full range of HMRC Online Services,
however these are accessed via the new AS home page. If an agent opts in to AS, they
are advised that if they have shared their Government Gateway user ID and password
with other agents in their firm, they will also be opted in to the service and will see
the new home page when they next log into HMRC. They will still access the same
HMRC services but will do so via the AS home page. Therefore, agents opting in
to the service should tell anyone else who uses the same login that the view of their
HMRC online services are going to change.
ACCA Chas Roy-Chowdhury
While the current service has been built primarily with the smaller agents in mind,
the requirements for larger firms are being addressed by delivering functionality that
will allow developers to build PAYE data into third party software. We hope this
functionality will be exposed to developers in coming months. Prototype screens
of the current AS service are available to view and provide feedback on via GOV.UK.
AAT Jeremy Nottingham
AIA Tim Pinkney
ATT Jon Stride
CIMA
CIOT Nigel Clarke
CIPP
IAB Kelly Lant
ICAEW Caroline Miskin
ICAS Charlotte Barbour
ICPA Tony Margaritelli
IFA
VATPG Ruth Corkin
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