Guidance

Issue 127 of Agent Update

Published 16 January 2025

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This publication is available at https://www.gov.uk/government/publications/agent-update-issue-127/issue-127-of-agent-update

Technical updates and reminders

Developments and changes to legislation and allowances relating to UK tax including:

Tax

Borders and Trade

Making tax Digital

HMRC Agent Services

Agent online forum and engagement

Latest updates from the partnership between HMRC and the main agent representative bodies. Including:

Tax

Changes to repayment processing when agents become insolvent

We have changed how we handle repayment requests when an agent becomes insolvent. This affects cases where the agent is shown on PAYE repayment claims as the nominee to receive repayments on behalf of taxpayers. This means if your firm became insolvent, any repayments due to your clients would be paid directly to them, ensuring they receive the money they are owed promptly. This will protect taxpayers and minimise delays.

Initially, this change applies to repayments for:

  • marriage allowance
  • Income tax deducted from savings and investments (R40)
  • employment expenses (P87)

We will notify you when this process extends to other types of repayments.

Classification for double cab pickups (DCPUs)

Following the government’s Autumn Budget 2024 announcements, HMRC has published new guidance regarding a change in the interpretation of how double-cab pickup (DCPU) vehicles should be classified for car benefit, capital allowances and some deductions from business profits purposes.   

The current treatment of DCPU vehicles as outlined in Employment Income Manual 23150 was adopted from 2002 and is based on payload. This finely balanced test is inconsistent with the Court of Appeal’s decision in Payne and Ors (Coca-Cola) v R and C Commrs (2020) (BTC19) which established that a narrow margin of suitability is not sufficient to determine that a vehicle is primarily suited for a particular purpose, and that in cases where a vehicle cannot clearly be identified as being predominantly suited for carrying goods the default should be that the vehicles are cars.

New guidance for car benefits, part of the Employment Income Tax Manual EIM23151, explains that from 6 April 2025, HMRC will no longer be applying this payload test to determine whether a DCPU is primarily suited for the conveyance of goods or burden. From that date, a vehicle must be assessed as a whole at the point that it is made available to determine whether the vehicle construction has a primary suitability. The guidance also provides information on the transitional arrangements for DCPUs leased, purchased or ordered before 6 April 2025.

New guidance is available on GOV.UK for capital allowances CA23511. This explains the change in treatment for expenditure incurred on or after 1 April 2025 for Corporation Tax and 6 April 2025 for Income Tax. It also 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.

Follow updated guidance on deductions from business profits and cash basis expenses BIM70035.

Research and Development (R&D) tax reliefs — New R&D Disclosure Facility & Emailed R&D claimant support packages

New R&D Disclosure Facility

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

This facility will make it easy for customers, or their agents, to disclose inaccuracies in R&D claims.

Due to the voluntary nature of this disclosure facility, any penalties will usually be accepted as ‘unprompted’. This will mean a lesser penalty than awaiting any potential HMRC intervention.

The facility is a form on GOV.UK. Customers and agents will self-serve any tax, tax credit repayments, interest and penalties due. Completion of the form includes uploading computations, explanations and the submission of a letter of offer.

HMRC will review the disclosure and if the offer is satisfactory a letter of acceptance issued.

The disclosure facility is only for:

  • R&D claims that are out of time to amend using the Company Tax Return (usually 2 years from the end of the filing date)

  • customers who have self-served R&D inaccuracies as mistake despite taking reasonable care or carelessness

  • any deliberate inaccuracies will be re-directed to the Contractual Disclosure Facility

This facility does not require notification of the intention to make a disclosure.

Full details are available on GOV.UK regarding the completion of the disclosure form.

R&D claimant support packages

HMRC are emailing guidance packages to customers following submission of R&D Claim Notification and Additional Information Forms (AIF). These packages will provide customers with key pieces of guidance and support when making R&D claims. Initially emails will be sent on a trial basis to a random selection of customers.

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 customer was not aware the forms were being submitted on behalf of the company

There is no requirement to respond to these emails.

These emails will never ask for any personal or financial information.

New online iForm for PAYE (P87) employment expenses

Further to our previous article in Agent Update, HMRC has now reimplemented the ability to claim tax relief on work expenses (for example, professional subscription fees or mileage allowance) through an online form.

We had to temporarily switch to a paper and post route, between 14 October 2024 and late December 2024, to respond to a growing tax risk driven by ineligible claims for employment expenses.

We need to make sure that customers get the tax relief they are entitled to, in as straightforward a way as possible. However, we also need to make sure that we identify where customers are not eligible and prevent them receiving payments they are not entitled to.

From 20 December 2024, customers were advised of an online route available. Individuals who wish to claim tax relief for employment expenses can submit their claim and supporting evidence using a new online iForm.

This will make it easier for individual employees who may have been put off from claiming employment expenses, due to the temporary unavailability of an online route.

Please view our updated issue briefing on evidence required to claim PAYE expenses.

We are sharing this update for awareness purposes. Agents representing individuals will still need to submit their claims through the usual paper-based submission route.

Borders and Trade

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.

We’re supporting businesses to get ready for the new requirements, and have published detailed information on the steps you can take to prepare on GOV.UK.

Updated information on where liability sits for different transport modes used for import and export of goods into Great Britain can be found on GOV.UK.

If you are not ready to start submitting Safety and Security declarations, speak to your supply chains now to check who is responsible and agree 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

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.

By attending these MTD events, you will:

  • learn more about taking part in the testing phase and the additional support you will get
  • receive hands-on guidance to sign up for testing
  • understand which clients will fall under MTD for Income Tax
  • gain clarity on MTD obligations and compatible software
  • discuss managing clients using the Agent Services Account
  • have the opportunity to ask HMRC your MTD-related questions

Registration is now open for the following events, which will each take place from 11am to 3pm:

  • Monday 24 February 2025 — Leeds
  • Tuesday 4 March 2025 — Belfast
  • Thursday 27 March 2025 — Edinburgh

Spaces are limited, so if you are interested in attending, email mailboxmakingtaxdigital@hmrc.gov.uk and tell us which event you would like to attend in your email. By emailing HMRC, you consent to being contacted before, during, and after the event.

You can find information about MTD for Income Tax and what you need to do to get ready for this change in the MTD for Income Tax agent toolkit.

HMRC Agent Services

Only 15 days left to file your clients Self Assessment tax return

Tax agents who have not submitted their client’s tax return, only have 15 days left to file online.

The Self Assessment filing and payment deadline is 31 January. Last year over 513,000 agents left it until deadline day to submit their clients tax return. We’re encouraging agents to file now to avoid anything that might result in a delay and your client getting a penalty.

It’s often easier and quicker to use our free online services for Self Assessment.

Here are 3 great online resources agents can use:

  • Use the Self Assessment online service for agents to file your client’s tax return online, view their statements and payments, get their PAYE coding notice and update their contact details.

  • The Income Record Viewer (IRV) can help you prepare and check tax returns. The IRV gives you access to your client’s pay, tax, employment history, pension (private and state) and tax codes.

  • Check our performance and service levels for post and online services. This tool is specifically for agents and you’ll see when you might expect a response from us, with processing dates for Self Assessment refunds, tax return amendments, registering and more.

You can find more services for agents on GOV.UK. Our YouTube channel also includes helpful videos on Self Assessment which you can pass on to your clients. Our latest video on Understanding your Self Assessment statement is in a new question and answer format and covers the top call reasons we get on the helpline about the statement.

Agent access to the public service pensions remedy digital service

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:

You should email HMRC publicservicepensionsremedy@hmrc.gov.uk by 31 January 2025 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.

Tax agents handbook

The new tax agents handbook is now live on GOV.UK.

It is a redesign of the existing tax agents and advisers guidance collection, presenting information about authorisations, registering for services, contacting HMRC, and other useful guidance and support.

We’re keen to continue developing it further, so do provide any feedback and suggestions for the handbook using the short survey on the tax agents handbook page.

Support for customers who need extra help

We have principles of support for customers who need extra help. These set out our commitment to support customers according to their needs, and underpin the HMRC Charter.

Find out how to get help and what extra support is available.

Contact

Complain to HMRC

You can complain to 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 to get 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

You can check the latest updates to HMRC manuals or subscribe to automatic notification of changes. You can also suggest improvements for pages of our manuals by using the feedback options on the page.

Online

You can find online training material and useful resources through the HMRC email updates and webinars for tax agents and advisers page. 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.

Agent forum and engagement

Updates on issues raised on the Agent Forum that are being progressed in the Issues Overview Group (IOG).

Help us improve the information we provide on GOV.UK

We regularly receive feedback from the agent community — directly and from professional bodies, the Agent Forum and the Issues Overview Group (attended by agent professional bodies) regarding content on GOV.UK. We use this to make improvements, corrections, and clarifications.

We also receive feedback from the Agent Forum and the Issues Overview Group (attended by agent representative bodies).

There are other quick ways you can help us to improve the information we provide on GOV.UK.

‘Is this page useful?’ This question appears on each GOV.UK page, giving you the option to select ‘Yes’ or ‘No’. You can answer anonymously and doing so really helps HMRC to understand what guidance is working as intended and what needs their attention. If you answer ‘No’ you also get the option to provide your email address so you can be sent a further survey.

‘Report a problem’ This is another button that appears on every GOV.UK page. It allows you to quickly report anything from a broken link to missing or incorrect information with the minimum amount of fuss. We monitor this anonymous feedback closely, making changes to manuals to fix errors and improve clarity.

Contact GOV.UK — This is another button that appears on every GOV.UK page. Select ‘Contact’, then select ‘Contact GOV.UK’. This brings up an electronic form which you can use to provide more detailed feedback on the contents of a page. This feedback is then read by one of our subject matter experts who, if you’ve provided your contact details, will be able to provide you with a response.

Registering for the Agent Forum

The Agent Forum is an online channel that agents can use to report systemic and widespread issues with HMRC systems that are adversely affecting taxpayers and their clients.

Registering for the Agent Forum is easy, but members must agree to the forum terms and conditions and good practice guide as part of the registration process.

Contact Information for professional and representative bodies

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