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Guidance

Issue 144 of agent update

Published 18 June 2026

© Crown copyright 2026

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This publication is available at https://www.gov.uk/government/publications/agent-update-issue-144/issue-144-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 engagement

Tax

Tax fraud warning — attempts to use ‘Bills of Exchange’ to pay HMRC

HMRC has published a tax fraud warning to raise awareness of a new fraudulent ‘payment model’ using Bills of Exchange to pay a tax liability. 

A Bill of Exchange is defined in the Bills of Exchange Act 1882. It is a note from one person to another, requiring that person to pay a certain sum of money to them or to a third party. However, it is up to the recipient to decide whether or not to accept the bill as a form of payment. Even when the bill has been drawn up according to the legislation, the recipient has no legal obligation to accept it. HMRC does not accept Bills of Exchange against a tax liability. 

It is currently being marketed to employers, recruitment and temporary labour agencies. However, any business could be approached as it is not tax or trade sector specific. 

Organised crime groups are particularly active in the temporary employment agency and recruitment sector, but we want to raise awareness for all businesses. 

Read more on Bills of Exchange.

Promoters claim that a Bill of Exchange can be used to eliminate an HMRC debt. They offer to manage the process for customers, particularly payroll providers, and act on the customer’s behalf drawing up any affidavits and engaging with HMRC. 

In addition to Bills of Exchange, other forms of wording in promotional material may include reference to money orders, Public Trusts, Merchant Law or Negotiable Instruments. 

Promoters may also claim that using Bills of Exchange can avoid the new umbrella company legislation which was introduced from April 2026. This is not true. Read more on details of the changes to Income Tax rules to tackle non-compliance within umbrella companies. 

In some cases, promoters may claim that the use of these arrangements is accepted or unchallenged by HMRC, or that the arrangements have been approved by King’s Counsel (KC). This is not the case. 

Using these arrangements could result in significant costs to your clients’ businesses, not only through paying the promoter to use or facilitate their payment model, but also additional interest, penalties or fees that may be charged by HMRC where a debt is not fully paid on time. 

We are here to help advise you of new or emerging fraudulent arrangements that could significantly cost your clients’ business. 

If you think you may already have clients using this payment arrangement you should advise them to contact HMRC as soon as possible. 

There is a range of ways on offer to guide you on How to make a voluntary disclosure to HMRC. We can help your clients get back on track. 

HMRC’s  guidance clearly sets out:

If you’re concerned about an individual or organisation offering your clients a tax saving arrangement, avoidance scheme or fraud arrangement, you can report it to us using our report tax fraud or avoidance online form.

You can submit this form anonymously and are not required to give your name, address or your email address. 

You can also phone HMRC to report tax fraud or avoidance if you cannot use the online form. 

Old Inheritance Tax 100 forms will no longer be accepted after 31 August 2026

HMRC will stop processing old Inheritance Tax 100 forms (IHT100) after 31 August 2026. We informed you about this in the HMRC Trusts and Estates newsletter in August 2024. If you submit previous versions of these forms after 31 August 2026 they will not be accepted and you will be asked to resubmit the correct version.

To help avoid any issues or delays, make sure you switch to the latest forms as soon as possible. Use the new forms to inform HMRC that Inheritance Tax is due.

Read more in the HMRC Trusts and Estates newsletter: August 2024.

Corporate Interest Restriction — reporting companies

Background

Corporate Interest Restriction (CIR) allows groups to appoint a reporting company which helps with the administration of the rules. This includes the filing of Interest Restriction Returns (IRRs) for the group.

HMRC introduced changes to the CIR rules in Finance Act 2026. CIR rule changes followed the announcement which aimed at simplifying rule compliance for customers.

Periods ending on or before 30 March 2026

For periods ending on or before 31 March 2026, the existing rules broadly continue to apply. Where a reporting company appointment has not already been made, groups must still notify HMRC of these appointments. Use the existing approved filing methods such as the online form on GOV.UK or commercial software. This will be particularly relevant, for example, for groups that are in the process of preparing their IRR for the year ended 31 December 2025.

Periods ending on or after 31 March 2026

For periods of account ending on or after 31 March 2026, groups no longer need to make reporting company appointments ‘by notice’ to HMRC. Instead, they will in future be required to disclose details of these appointments in their IRR for that period. Reporting company appointments only have effect for the specific period of account.

HMRC is in the process of updating the IT software to enable this disclosure. The legal obligation to disclose this additional information will be put in place when the IT changes are nearer completion. For the time being, continue to file using the existing forms or software. We will provide further updates in due course.

If you have any queries or concerns regarding the reporting requirements, contact the CIR team by email cirworkinggroup@hmrc.gov.uk.

Voluntary National Insurance contributions for periods abroad   

From 6 April 2026, for tax years 2026 to 2027 onwards, the option to pay voluntary Class 2 National Insurance contributions for periods abroad has been removed. New Class 3 National Insurance contributions applications for periods abroad will require 10 years continuous UK residency or at least 10 years of paid National Insurance contributions. 

If you have clients who work abroad, make them aware of the changes that came into effect in April 2026.

If your clients currently pay Class 2 National Insurance contributions abroad:

  • HMRC will write to them from July 2026 if they are affected
  • if they pay by Direct Debit, they should not cancel it — HMRC will collect their final payment for the 2025 to 2026 tax year on 10 July 2026

The changes do not affect the ability of anyone to purchase voluntary Class 2 National Insurance contributions for tax years prior to 2026 to 2027.

HMRC encourages employers to review the latest guidance detailing the changes:  

The changes are being made to ensure that individuals building a State Pension from outside the UK have a sufficient link to the UK and are paying a fairer price to do so.

Updates to Double Taxation individual and company form guidance for UK REITs

HMRC has updated several Double Taxation forms and guidance relating to UK Real Estate Investment Trusts (REITs).

These updates will ensure the guidance is aligned with HMRC’s current position.

The changes include clarification of:

  • when certification by an overseas tax authority is required and how this should be provided
  • the requirements for letters of authority where agents act on behalf of claimants

Agents must make sure they use the latest versions of the following forms and notes.

The updated forms and guidance are available on GOV.UK:

Using the correct versions will help avoid delays when claims are submitted.

Borders and trade

Digital carnets launched on 1 June 2026

On 1 June 2026, the UK introduced digital ATA Carnets (e-carnets) alongside the EU, Norway and Switzerland.

An ATA Carnet lets you temporarily import or export commercial samples, trade fair or exhibition goods and professional equipment to countries that are part of the ATA Carnet system.

From June, this process will move from paper to a secure digital format.

Digital carnets will be accessible on mobile devices, allowing businesses and customs intermediaries to download carnets, prepare declarations and receive confirmations electronically.

There will be a transition period where both digital and paper carnets can be used, depending on the journey and destination. Issuing chambers will advise users whether a paper or digital carnet is required. All paper carnets issued before 1 June 2026 remain valid.

Businesses and intermediaries should refer to existing guidance on using e-carnets on the UK National ATA Carnet Organisation website.

Read more information on when an ATA Carnet is required and how to apply.

Customs intermediaries standard launched

A new customs intermediaries standard has been launched to set clear expectations of good practice across the sector. 

A certification scheme is in development for intermediaries to prove they adhere to the standard and to enable traders to make more informed decisions. The certification scheme is due to be introduced in 12 to 18 months.

Published as a Publicly Available Specification (PAS) on the British Standards Institution (BSI) website on 2 June 2026, the Customs intermediaries: Preparation and submission of customs declarations - specification sets out a shared baseline of good practice covering areas such as due diligence, systems and processes, customer service, transparency, complaints handling and continued professional development. 

It is sponsored by HMRC and developed collaboratively with industry representatives and the BSI.

Customs intermediaries play a critical role in the UK’s border and trade system, supporting businesses to meet customs requirements and move goods efficiently. A call for evidence in 2022 and subsequent public consultation in 2023 found that the quality of service across the sector was mixed, prompting the government’s commitment to develop a standard to improve consistency across the sector. 

Alex Pienaar, HMRC Director of Customs Policy and Strategy, said: 

Excellent standards across the customs intermediary sector are essential to maintaining a smooth and efficient border system, which benefits our traders and supports economic growth. 

Traders will be able to make informed choices about who they work with thanks to this new standard, which has been developed in full partnership between industry and HMRC. It sets out a clear, shared view of good practice, helping customs intermediaries to deliver their vital role in the border system, whilst maintaining agreed standards under a clear framework. 

I’d like to thank the many businesses and representative bodies across the industry who have worked closely with us to help shape it.

What this means for customs intermediaries 

Customs intermediaries are encouraged to:  

  • use the standard as a benchmark to review systems, processes and customer service
  • be open with customers about due diligence — asking for detailed and accurate information is a sign of good practice and supports compliant, high-quality service
  • use the standard to demonstrate professionalism and consistency, helping build customer confidence in the level of service they provide

What this means for traders    

Benefits and expectations for traders:

  • the standard clarifies what good service looks like, helping traders choose and work confidently with a customs intermediary
  • traders should expect intermediaries to ask detailed questions about their goods and business — this is intermediaries demonstrating due diligence, ensuring their clients provide accurate information to adhere to customs law
  • traders are encouraged to provide accurate information to help avoid errors, support smoother movement of goods across the border and to be compliant

The standard for customs intermediaries does not replace existing authorisations such as Authorised Economic Operator (AEO) status, which remains focused on compliance.

Read more information on the standard on:

Making Tax Digital

Get ready to meet the first quarterly update deadline

The first quarterly update deadline is 7 August 2026. To be compliant, you and your mandated clients should now be using MTD compatible software to create and store digital records. Compatible software includes using spreadsheets with bridging software.

If you have not already done so, there’s still time to sign up your client for MTD for Income Tax.

You should do this if their total gross income from self-employment and property exceeded £50,000 on their 2024 to 2025 tax return.

For extra support, check out our:

Three actions you should take after signing up

A reminder that you will need to take the following 3 actions before you send your client’s first quarterly updates.

  1. Authorise and connect your software to HMRC.
  2. Check you have selected the right accounting period in your software — if your accounting period is 1 April to 31 March, select ‘calendar periods’ in your MTD software before you send your first quarterly update, otherwise, leave it as the default period that aligns with the tax year (6 April to 5 April).
  3. Use the MTD compatible software to start creating digital records of your client’s income and expenses from self-employment and property.

Coming soon

There will be a special MTD edition of the agent update at the start of July, which will contain some practical steps and further support to help you and your clients meet the first submission deadline.

HMRC agent services

Get help with VAT online services

In April, we launched a new interactive guidance tool for newly registered VAT customers.

Customers can access the tool, where they will find guidance including videos to support them through the online VAT registration service. It will also help existing VAT customers to use self-service options available in their business tax account.

This is part of our transformation to improve our digital services so customers can manage their tax affairs and access the information they need without having to call or write to us.

Nudge your clients to file early — use free content available

June is a good time to start conversations with your clients about filing their Self Assessment tax return early. 

You do not need to wait for your client to contact you. Starting the conversation now could help you both to file their tax return earlier.   

To save you time and effort, we’ve provided ready-to-use content on Frontify.com to nudge early filing. It’s copyright-free — you just need to copy, adapt and share.

Content is available for your:

  • website or email newsletter — a brief explanation of the benefits and you can add any specifics
  • social media channels — linking back to your website

You can add it to your website, or in your client emails, and schedule in some social media this month. You can also use the free Self Assessment assets  in your communications.

Employment related securities — end of year return deadline

The deadline for filing annual employment related securities (ERS) returns is 6 July 2026. Missing the deadline will result in late filing penalties being charged to the employer.

Returns, including nil returns, must be submitted for every scheme that has been registered.

An ERS scheme needs to be linked to a live employer scheme. If the PAYE scheme is being closed, you must advise the scheme employer to tell HMRC if they are closing any ERS schemes. As an agent, you do not have the option to enter the date of the final event and close an ERS scheme.

If a scheme has been registered in error or it is no longer required, you must advise the employer to cease the ERS scheme. Once a scheme is ceased, an annual return must still be submitted for the tax year in which the final event date falls.

Multi-factor authentication — activation dates for agent accounts

Following successful testing and our ongoing engagement with tax and software professional bodies, HMRC will activate multi-factor authentication (MFA) on all remaining agent accounts in a way that gives agents greater certainty to prepare.

The introduction of MFA brings agent accounts in line with the protection already in place for individual and organisation Government Gateway accounts, and is part of HMRC’s ongoing work to protect agents and their clients from the evolving threat to online security.

Activation from 10 June 2026

From 10 June 2026 agents will be able to choose one of two specific dates for MFA to be activated on their account. This means agents who have already made the necessary preparations for MFA can make the switch on a date which best suits their business requirements. Agents who are ready to make the switch are encouraged to opt for an earlier date to benefit from enhanced security, protecting themselves and their clients.

Agents wishing to take advantage of this must notify HMRC by completing an online form. The form will be available from 10 June 2026 when signing in to either an agent services account or an HMRC online services for agents account. The form will not appear on accounts where MFA has already been activated.

If you choose to have MFA activated on:

  • 15 July 2026 — you must submit a form to HMRC by 11:59pm on 30 June 2026
  • 19 August 2026 — you must submit a form to HMRC by 11:59pm on 31 July 2026

Once activated, MFA will be applied to all accounts held under the agent identifier (ID) provided. Agents with multiple IDs can choose which ones to activate for each deadline. Any IDs not activated by earlier deadlines will automatically be included in the final activation window.

Final activation — 28 September 2026 to 15 October 2026

MFA will be activated on all remaining agent accounts that do not already have it between 28 September 2026 and 15 October 2026. HMRC is unable to give a specific date within this period to agents who are part of this final group. If you are not planning to have MFA activated before this date, you should use the time between now and September to ensure you are fully prepared.

We strongly encourage all agents to prepare in advance for their chosen activation date by selecting your preferred future settings and checking for any existing MFA settings that may be outdated. This will ensure you are ready to use MFA on the date it is switched on for you.

Full guidance on how to prepare including information on administrator roles, access code methods, and the ‘remember me’ function, is available in the updated Tax Agent’s Handbook.

Estates administration — clarifying formal and informal reporting positions

HMRC has identified a recurring issue in the administration of estates, where agents are treating estates as able to move between informal and complex estate reporting during the same administration period when the estate is already registered for Self Assessment.

This article clarifies HMRC’s position and sets out the correct approach.

Use one reporting position for the whole administration period

An estate’s Self Assessment reporting position is determined for the whole administration period, from the date of death until the estate is fully administered. It is not determined on a year by year basis.

First you must decide if the estate is informal or if it meets the criteria for formal reporting (Self Assessment).

Once it is registered for Self Assessment, this will apply until the end of the administration period. You cannot switch back to informal reporting once you register the estate for Self Assessment.

Moving from informal to formal reporting

Sometimes an estate initially falls within informal reporting requirements but later requires formal reporting as a complex estate, for example due to changes in income, gains, or claims.

If the estate becomes complex, register it for Self Assessment using the Trust Registration Service. From the option menu, select the tax years for the period the estate is considered complex and requires tax returns.

For earlier years before registration, report income and capital gains other than residential property informally only (do not submit Self Assessment returns).

Once registered, the position is fixed. The estate cannot subsequently move back to informal reporting during the same administration period.

Notice to file and nil returns

If a notice to file has been issued for a tax year but there is no income, gains or claims to losses or reliefs to report, contact HMRC and ask to cancel the notice to file for that year.

This avoids unnecessary returns but does not change the estate’s status.

Do not submit Self Assessment returns for informal estates

If the estate is informal, do not send a Self Assessment return. If you do, HMRC will treat it as a voluntary return under FA2019 Part 4.

No automatic late filing penalty will be charged, however late payment interest and penalties may still apply as statutory payment deadlines continue to apply.

Importantly, a voluntary return is treated as if a notice to file had been issued.

Registering an estate that was previously informal

When registering the estate on the Trust Register for Self Assessment tax returns, send a letter to HMRC with:

  • the name, address and phone number of the personal representative
  • the name, address, National Insurance number, and Unique Taxpayer Reference (UTR) of the person who died
  • a year-by-year breakdown of any income and capital gains (profits from selling shares, investments, or property)
  • any Income Tax and Capital Gains Tax already reported and paid during the administration period, for example if residential property of the estate has been sold

Estates that stay informal throughout the administration period

Only report income and gains once at the end of the administration period (not every year).

Wait for HMRC’s payment reference, then pay any tax due in one single payment.

Providing feedback on HMRC manuals

HMRC manuals contain technical guidance for HMRC staff and tax professionals. Their primary purpose is to explain HMRC’s interpretation of relevant legislation, which is the basis on which the department makes decisions.

To tell us whether a page is useful, suggest improvements or report a problem with a page, you can use the:

The HMRC manuals team review all items of feedback on HMRC manuals from internal and external users.

Within the last 12 months we received 1,494 feedback comments and 60% led to guidance improvements. However, the volume is still low compared to the overall usage. Help us improve the content by providing feedback, even if it is to indicate that a page is useful.

Reminder — mandatory tax adviser registration now open

If your firm submits returns, makes payments or communicates with us on behalf of clients, you are likely to be in scope for mandatory tax adviser registration.

Registration is now open for firms that do not already have access to an agent services account, and the deadline to apply is 18 August 2026.

You can check if you need to register and by when.

Agent engagement

Register your interest — HMRC webinar on strengthened powers

We are hosting a webinar to outline HMRC’s strengthened powers to tackle tax advisers who facilitate non-compliance. 

The webinar will be held on:

  • Wednesday 24 June at 1.45pm
  • Thursday 9 July at 11.45am

The session will cover:

  • what counts as a tax adviser
  • what we mean by sanctionable conduct
  • what happens if HMRC identifies sanctionable behaviour
  • new powers enabling HMRC to publish information about tax advisers

There will also be an opportunity to ask questions.

Register for a webinar.

Sign up for future user research to improve the Digital Assistant and webchat journeys

Would you be interested in shaping how you would communicate with HMRC online? HMRC would like to invite tax agents who manage tax affairs on behalf of clients (including organisations) to take part in upcoming user research sessions.

Register your interest with HMRC today.

Borderline excepted estates — supporting agents to get Inheritance Tax reporting right

To return, or not to return, that is the question.

Since changes to the excepted estate regulations in January 2022, more estates are now able to apply for a confirmation or grant of representation as excepted, meaning a full Inheritance Tax account (IHT400) is not required. 

However, there is now a large gap between liability to tax and accountability (returning an IHT400).  This gap is caused by the various nil rate band (NRB) tax allowances. Two are automatically due (NRB and Residence NRB) whereas the two transferable allowances must be claimed.  We have noticed that some estates are choosing not to return an IHT400, although they are not excepted from doing so. They are relying on the tax allowances to remove any Inheritance Tax liability.

By failing to return an IHT400, these estates are running a risk that the tax allowances may not be correctly calculated or are out of time (because they needed to be claimed).  Where it subsequently emerges that tax is due, they will face tax and penalties. To support agents in getting it right, HMRC is issuing an educational One to Many (OTM) letter as part of the Borderline Excepted Estates project. 

The letter is being sent to agents who have submitted excepted estate grants with values at or around the various nil rate band (NRB) thresholds (£325,000, £500,000, £650,000, £825,000 and £1 million). Its purpose is to identify common errors and misunderstandings around each of the NRB allowances, so that agents can avoid these pitfalls and claim them correctly.

The guidance encourages agents to ensure that estate valuations and allowance claims are accurate and well supported at the point of applying for probate. Where there is any uncertainty about eligibility or values, agents are reminded that submitting a full Inheritance Tax account (IHT400) may be the most appropriate route. Relevant GOV.UK guidance is also signposted to support agents in checking the rules. 

This is a preventative and educational exercise, not a compliance investigation. By providing clear and practical guidance, the aim is to help agents and their clients get things right first time and reduce the need for downstream checks later.

Update on HMRC compliance activity for creative tax reliefs

The operating landscape for creative tax reliefs continues to evolve, including changes in claimant behaviour and growth in the overall value of claims.

HMRC continues to examine recent trends to ensure it fully understands how the reliefs are operating in practice and any implications for compliance risk.

This may result in an increase in enquiries across relevant reliefs, including a small number of random enquiries. This helps ensure assurance activity reflects the full population, not only cases already identified as higher risk.

HMRC will continue to ensure that all enquiries are conducted professionally, minimising any delay for customers. Our focus remains on supporting taxpayers to get things right first time, while ensuring a fair, proportionate and evidence-based approach to compliance.

Live webinar — the temporary repatriation facility and trusts

Live webinars are taking place on 30 June and 8 July 2026 — providing a high-level overview of the temporary repatriation facility (TRF) for personal foreign income and gains before focusing on the TRF extension for trusts. The content will be delivered across two sessions — make sure you sign up for both part 1 and part 2.

In part 1 we will cover:

  • key TRF principles
  • application to trust capital distributions and differences from personal foreign income and gains (FIG)
  • qualifying overseas capital in relation to trust structure payments
  • TRF treatment of trust benefits taxed under the transfer of assets abroad provisions

In part 2 we will cover:

  • TRF treatment of trust benefits under the settlements provisions
  • transitional trust income, protected foreign source income, and available protected income
  • capital payments from non-resident trusts and TRF treatment under capital gains provisions
  • the concept of virtual matching

The webinars are aimed at those with a working knowledge of the remittance basis, offshore anti-avoidance legislation, and an awareness of the background of the 2025 non-domicile reforms. They focus only on the TRF and will not cover other aspects of the reforms.

Register for the:

Contact information for professional and representative bodies

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