Making Tax Digital and Self Assessment: updates and tips

Susan Cattell highlights HMRC’s MTD engagement and self-assessment tips.

 It’s a busy time for many tax advisers – with ongoing preparations for Making Tax Digital and self-assessment season under way. It’s worth remembering that HMRC is offering engagement and tips to help agents. 

Making Tax Digital 

HMRC outreach: HMRC is offering engagement with agents to support preparations for MTD – this includes peer group sessions and potentially direct support and information. Agents need to complete an HMRC online form to express an interest by signing in with the Government Gateway ID and password linked to their Agent Services Account (ASA). Agents who don’t yet have an ASA can still complete the form using their existing HMRC online services for agents account (but will need to manually provide contact details).

Finding software: The MTD software choices tool now includes products that are in development as well as those that are ‘ready now’. Some products may be ‘ready now’ for quarterly updates but still in development for the tax return. The number of products with accessibility features has also increased.  

Applying for an exemption from MTD: Agents can now apply for exemptions on behalf of clients (and taxpayers can apply themselves): HMRC has set out how to apply and published detailed guidance on eligibility.  It’s important to remember that those who were exempt from MTD for VAT need to contact HMRC, so that HMRC can check their circumstances – the exemption won't  automatically carry across.  

PCRT topical guidance: finally, don’t forget that ICAS and the other PCRT professional bodies have issued topical guidance on MTD for income tax. This will be updated to cover additional questions raised by members and any new information that becomes available – the latest version can be found on the ICAS PCRT page, in the section headed ‘Topical Guidance’. 

Private use adjustments – HMRC focus on compliance 

HMRC is running a campaign to highlight problems with reporting private use adjustments for business expenses and to encourage accurate reporting. Emails were sent to self employed taxpayers, starting in October, explaining that only expenses that are wholly and exclusively for business purposes can be deducted in calculating taxable profits. Personal use adjustments may be required for assets and expenses for both work and personal use.  The email included a link to guidance on simplified expenses on gov.uk.

This is a risk area HMRC will be focusing on. It intends to open more enquiries into private use adjustments for business expenses claims. It would like agents to review and address any incorrect apportionments before submitting returns. In particular, making sure that expenditure claims are restricted to those for business use only and that expenses are apportioned correctly for the expenditure and circumstances of that year. 

Top 10 self-assessment tips for tax agents 

The latest edition of Agent Update (issued on 20 November) includes HMRC’s top 10 practical tips to help agents in the run up to the self-assessment deadline on 31 January 2026. The top five are reproduced below – and all 10 can be found in Agent Update issue 137.

1. How to get tax returns and repayments right 

Errors can result in delays and incorrect payments. Here’s how to get it right: 

• Check the client’s details are correct and up to date, this includes their bank sort code/ account number, UTR, National Insurance number, name and address. 
• Leave 14 days after making a payment before requesting a repayment.  
• For clients who were previously bankrupt, use their post-bankruptcy UTR for repayment requests. 
• Notify HMRC of the capacitor if the client died before submitting their tax return and before requesting a repayment. 
• Encourage clients to receive their repayment electronically – BACs is the quickest and securest method. 

2. Register or reactivate SA before filing 

It takes longer to process tax returns from customers who haven’t registered for SA prior to submitting their tax return or who didn’t reactivate their SA account if they filed tax returns in the past. 

People who are new to SA must register with HMRC so they can be set up on the system and receive a notice to file. Agents can register by completing an online SA1 or CWF1 form.  

If your client has previously been in SA and didn’t file a tax return last year, make sure their SA account is reactivated, and they receive their notice to file before submitting their tax return. Returning SA customers don’t need to register as new, as they already have a Unique Taxpayer Reference (UTR). This can be done by:  

• The client in their online account. 
• The agent by calling the Agent Dedicated Line and selecting option 2, and then ‘SA reactivations’ when prompted (note: if you select the wrong option, you won’t be redirected). 
• By completing an online SA1 or CWF1 form.  

3. Stopping self-assessment  

If your client no longer needs to file a tax return, contact HMRC as soon as possible. You can do this using webchat, by calling or writing to us. 

Your client can also notify us. Information on how to do this is on gov.uk which you can pass on to them to action. 

If HMRC isn’t informed, clients will continue to receive reminders, and they may get a penalty if they don’t file on time. 

 4. Track progress with the ‘where’s my reply’ tool.

Use the where’s my reply tool to check when you can expect a response from HMRC. If the due date has passed, contact HMRC using the webchat service or call.  

You can use the Personal Tax Query Resolution Service for agents to escalate SA and PAYE queries if you: 

• Checked the where’s my reply tool and the date given has passed by at least 20 working days. 
• Attempted to resolve the query at least twice by contacting the Agent Dedicated Line or webchat. 
• Haven’t already initiated a formal complaint to HMRC. 

The service doesn’t cover employer related queries or repayment progress chasing.  

Agents will be directed to use the service in the where’s my reply tool if the query is eligible. 

5. Marriage Allowance sequencing 

Tax returns that include Marriage Allowance transfers must be submitted in the correct sequence to avoid delays. 

Step 1: the person transferring the allowance (transferor) should submit their tax return first if the person receiving the allowance (recipient) is also in SA.  

Step 2: the recipient should leave 72 hours after the transferor has submitted their tax return before submitting theirs.  

Processing times for online SA returns can vary but are generally acknowledged within 72 hours and fully processed within two weeks. 

Let us know what you think 

We respond to tax consultations and calls for evidence and attend meetings with HMRC at which service levels, delays and other issues you raise with us are discussed. We welcome input from members to inform our work; email us to share your insights and feedback. 

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