Signing up through
an accountant

Plenty of sole traders and landlords would rather their accountant dealt with Making Tax Digital for Income Tax, and the rules are built for that. An agent can sign you up, keep your digital records, send your quarterly updates and submit your tax return, as long as you have authorised them and they use compatible software. Making Tax Digital also lets you split the work: a bookkeeper on the quarterly updates and an accountant on the tax return, which Self Assessment never allowed.

This guide explains how signing up through an agent works from your side and from theirs, the two kinds of agent, and what remains your job. It is based on GOV.UK's pages for agents and for clients authorising them.

“For example, a bookkeeper might complete quarterly updates. In this scenario, they are a supporting agent. An accountant might finalise the client's overall tax position and submit their final tax return. In this scenario, they are a main agent.”

Who can be signed up by an agent

The conditions are the same as signing up yourself. GOV.UK says that to sign up a client, they must be registered for Self Assessment and have submitted a tax return in the last 2 years. The guidance on authorising an agent puts it from your side: your agent can only sign you up if you have registered for Self Assessment and already submitted a tax return.

The agent must also be authorised by you. GOV.UK is plain about it: if an agent is not authorised by their clients, they cannot sign them up. And they need your permission to sign you up.

How it works from the agent's side

GOV.UK's step-by-step guide for agents has seven steps:

1. Work out the client's qualifying income.
2. Find out if and when the client needs to use Making Tax Digital for Income Tax.
3. Apply for an agent services account.
4. Add client authorisations.
5. Get compatible software.
6. Sign up the client.
7. Use Making Tax Digital for Income Tax.

The agent services account is different from the HMRC online services for agents account many accountants already have. Existing Self Assessment client authorisations can be copied across: the agent selects "Add existing Self Assessment authorisations to your agent services account", which adds every client linked to that Self Assessment agent code and makes the agent their main agent. Adding authorisations does not sign anyone up, though: each client is still signed up individually through the online service.

To sign you up, your agent needs your full name, date of birth and National Insurance number. If you are a sole trader, they also need your business name, address and trade. For each income source they need its start date (if within the last 2 tax years) and confirmation of the tax year you will start.

How it works from your side: the authorisation link

If your agent is not already authorised for your Self Assessment, they ask you to authorise them from their agent services account. GOV.UK calls this the digital handshake.

1. Your agent sends you an email with a link.
2. You select the link and sign in with the sign-in details for the tax service, for Self Assessment, the user ID and password you use for your return. If you have more than one account, use the right one.
3. You may be asked to verify your identity.
4. You give the authorisation. The consent statement you see depends on whether the agent asked to be your main or supporting agent.

The link expires after 21 days. If you miss it, ask your agent to send another. GOV.UK adds a warning worth repeating: you must not give your sign-in details to your agent or anyone else.

Main agents and supporting agents

Making Tax Digital for Income Tax lets you use more than one agent, which other services such as Self Assessment do not. You can have only one main agent at a time but any number of supporting agents, a main agent with no supporting agents, or supporting agents with no main agent.

A main agent can do almost everything you can. A supporting agent sees only your business and property income details. If several agents work on the same business, GOV.UK says they must make sure one combined update goes to HMRC for each update period, and one tax return after any adjustments.

If you change your main agent, it is your job to tell the old one: once you choose a different main agent, the old one loses access to your account. You can remove an agent yourself through "Manage Your Tax Agent" or "Manage who can deal with HMRC" in your tax account.

What each kind of agent can do, out of the nine tasks in the table above

• Main agent8 of 9
• Supporting agent5 of 9

Connecting the software

Whoever keeps your records connects their software to HMRC. For an agent, that means signing in with the firm's agent services account details in the software and giving permission. GOV.UK says the connection is repeated every 18 months. If you keep your own records in an app and your accountant does the tax return, you connect your app with your own sign-in, and the accountant connects theirs.

Remember that only one software product can be used for each separate submission. If your bookkeeper sends your quarterly updates from one product, you cannot send some of them from another.

What stays your responsibility

Authorising an agent does not hand over responsibility. GOV.UK says you are responsible for your own tax affairs, even if you authorise someone to act on your behalf. It also says that if your agent can submit tax returns for you, you must check the information in your return is correct and let your agent know before they submit it.

The deadlines are yours too: your agent works to the same dates you would, 7 August, 7 November, 7 February and 7 May for updates and 31 January for the return. Agree early who sends what, and when you need to get your records to them.

What to agree with your accountant before you start

Making Tax Digital turns a once-a-year job into five, so the arrangement with your accountant needs more detail than it used to. These are the questions worth settling before the first deadline:

• Who signs you up? If HMRC has not signed you up and you have not done it yourself, decide whether your accountant does it. If HMRC has already signed you up, tell them, so they do not try again.
• Main or supporting? If one firm does everything, it will usually be your main agent. If a bookkeeper sends the updates and an accountant does the return, the bookkeeper can be a supporting agent and the accountant the main agent.
• Whose software? Only one product can be used for each submission, so agree which product sends your quarterly updates and which submits the return.
• When do your records reach them? Each update is due about five weeks after its period ends: 7 August, 7 November, 7 February and 7 May. Agree a date before each one by which your records are complete.
• What do you check before they file? GOV.UK says you must check your tax return is correct before your agent submits it. Ask to see each quarterly update too, so nothing surprises you in January.
• Who is the contact for problems? HMRC has a dedicated line for agents, 0300 200 3311, separate from the Self Assessment line for individuals, 0300 200 3310.

If your accountant is still using the HMRC online services for agents account only, ask whether they have an agent services account yet: GOV.UK says it is a different account, and they need it to sign clients up. The deadlines page has every date to plan around, and the quarterly update glossary entry explains what each update contains.

Volunteers and penalties

If your accountant signs you up early as a volunteer, there is one decision to make together. GOV.UK says volunteers must agree that the new penalties apply to them, that an authorised agent can agree on a client's behalf, and that this should be discussed with the client before signing them up. Once agreed, it cannot be undone, even if you stop volunteering. The guide to signing up early covers what the new penalties mean for volunteers.

Working with an accountant on TapTax

Many sole traders keep their own records day to day and want an accountant only for the year-end. That fits the supporting and main agent split: you keep records and send updates in your own software, and your accountant handles the tax return. TapTax is built for the record-keeping half: you photograph receipts and import bank statements, TapTax sorts them into HMRC categories and checks each quarterly update with you before you file. The MTD filing features page shows what it covers.

If you would rather sign up yourself, how to sign up walks through it, and first steps after signing up covers what comes next. If HMRC has already signed you up, start with what to do when HMRC signs you up, and tell your accountant straight away.