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Software required to access clients' digital accounts

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20th May 2016
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In spite of what has been promised in various presentations concerning making tax digital, HMRC has confirmed that tax agents will not get direct access to their clients’ online digital tax accounts (DTA) for individuals or businesses.
 
This fact was revealed in a HMRC webinar on Agent Services presented on 19 May 2016, which is still available to listen to.
 
Two reasons were given for this. The first is that it is not part HMRC’s Agent Strategy to provide digital tax accounts for agents.
 
The second reason is a practical authorisation problem. The digital tax account covers all the taxes paid by an individual or a business to HMRC, but the tax agent may not be authorised to deal with all those taxes for the client. HMRC say it is very difficult to ‘grey out’ or block the parts of the tax account which the agent doesn’t have authorisation to see. So instead of solving that problem, no direct access will be given at all to the client’s DTA.
 
Instead the tax agent will need to use third party software to access the services and features contained in their client’s DTA. HMRC will allow the data in each taxpayer’s DTA to be accessed by an application program interface (API). That API will be integrated intothe third party or in-house software used by tax agents, and if the authorisation checks are passed, the agent will be able to see the data which he is authorised to see in the DTA, but not necessarily the full picture.
 
HMRC is to adopt an “API first” approach to provide tax agents’ access to DTAs. If HMRC find that there are gaps in the market, say for very small tax agents that don’t use third party software, then HMRC will look to provide an alternative solution. What that solutionmay be was not explained.
 
The driver behind adopting a third party software approach is that tax agents won’t have to access HMRC’s webpages to access their online services. As over time the third party software will include all the services and features currently provided by HMRC online services. This is also perceived by HMRC to be a quicker way to provide a full range of services for agents, as it would take HMRC a long time to build the webpages needed to provide tax agents with direct access to those services.

Replies (37)

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By Tim Vane
20th May 2016 14:26

Maybe I missed something along the way but I thought this was always the plan. HMRC have said for a while that the primary access points was to be the APIs and that commercial software would be needed to access them by agents.

It also seems that HMRC are well behind their schedule for actually delivering these APIs.

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Tornado
By Tornado
21st May 2016 09:00

Agent access is OK through an API but it is essential that like the current system, it will not be necessary for the individual to have set up their own access to their digital tax accounts as well.

It is easy to expect every taxpayer to have access to their own DTA but this is a delusion and in practice it just isn't going to happen for the same reasons that 98 out of 100 of my clients do not currently have online access to their tax accounts.

As agents we are happy to deal with accounts and tax matters for our clients but most of them are not interested or are incapable of doing it themselves.

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Replying to Tornado:
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By mabzden
21st May 2016 12:20

I agree.

I went through the new government security system to set up a digital account a few months ago. It was a multi-step process, and I needed to enter data from my driving license and all sorts. It also depended on one of the verification companies having enough data to confirm your ID.

I would say 10% of my client base would be willing and able to go through that process. But the other 90% would put it off and do nothing, and this won't help accountants or HMRC.

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Replying to mabzden:
green
By victoriamariawood
23rd May 2016 13:26

Most of my clients have appointed an accountant to deal with their taxes because they are unable ( usually) or do not have the time required to "delve" into tax and deal with it themselves. Why have HMRC decided that the Tax Agent for small businesses - those that need help most - is an irrelevance in the modern world of tax ? One hopes that our associations are throwing all their resources at lobbying HMRC and protecting members' status as the professional tax interface between entrepreneurs and HMRC - for the sake of clients who actually want to get on with running their businesses and HMRC who do not have the resources to go back to the old days of guiding small businesses through their day to day transactions without the assistance of an accountant.

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Replying to mabzden:
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By richardterhorst
23rd May 2016 13:56

mabzden wrote:

I agree.

I went through the new government security system to set up a digital account a few months ago. It was a multi-step process, and I needed to enter data from my driving license and all sorts. It also depended on one of the verification companies having enough data to confirm your ID.

I would say 10% of my client base would be willing and able to go through that process. But the other 90% would put it off and do nothing, and this won't help accountants or HMRC.

I am very computer literate and an accountant and tax agent. I would not register myself. Life is too short to deal with HMRC nonsense like that.

No access to agents then HMRC penalty take, already obscenely high, will triple as taxpayers will not do the work themselves.

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By Neil Daws
21st May 2016 16:24

What happens to the system when it is hit by an Electro Magnetic Pulse from a Solar Flare?

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Replying to Neil Daws:
Tornado
By Tornado
21st May 2016 21:32

Neil Daws wrote:

What happens to the system when it is hit by an Electro Magnetic Pulse from a Solar Flare?

Your satnav stops working for a while -

http://www.dailymail.co.uk/sciencetech/article-3178801/Are-prepared-majo...

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Replying to Tornado:
RLI
By lionofludesch
22nd May 2016 11:20

Tornado wrote:

Neil Daws wrote:

What happens to the system when it is hit by an Electro Magnetic Pulse from a Solar Flare?

Your satnav stops working for a while -

http://www.dailymail.co.uk/sciencetech/article-3178801/Are-prepared-majo...

How did we manage without satnavs ? I have a thing called .... a map.

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Replying to lionofludesch:
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By leon0001
24th May 2016 10:14

FlatNav.
Also known as DadNav.

Thanks (1)
Replying to Neil Daws:
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By rosataylor
23rd May 2016 14:22

Exactly!!

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By Ian McTernan CTA
23rd May 2016 13:22

Let's hope the software companies (PTP/IRIS, I'm looking at you) don't use this as an excuse to ramp up their prices by another 15% due to 'added features' that 99% don't need or want.

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By petestar1969
23rd May 2016 13:25

So HMRC really are trying to get direct access to our clients and cut us out of the picture? Bar stewards!

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By Gone Sailing
23rd May 2016 13:26

So, they're not doing it because:
1. They're not doing it
2. It's too difficult - but not too difficult for somebody else.

Meanwhile the agents on whom they depend so massively continue to be marginalised.

It will be an interesting day if, when in a tax investigation or money laundering enquiry is underway, and the agent says they're not aware of something because HMRC deliberately made them unaware to save money.

Interesting clothes Emperor.

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By Charlie Carne
23rd May 2016 13:45

Maybe I'm missing something, but this strikes me as a very sensible solution from HMRC. As agents, we have spent years criticising the lack of information and clarity of reports from HMRC's web portal. It seems that HMRC have finally realised this and allowed third party software houses to access their data via an API.

Yes, HMRC have been slow at doing this and I understand from discussions with a number of tax software companies at Accountex earlier this month that the APIs are still not fully functional but, once that hurdle has been passed (in the next month or two?), we will no longer be reliant on HMRC producing limited and often incoherent reports. Instead, we can choose our favourite software vendor (or a number of them; perhaps one for CT/SA and another for PAYE or VAT) and have exactly the reports we want. Unlike HMRC, the vendors are not a monopoly and they will need to bring out whatever ranges of reports their customers want or they will swiftly lose business to their competitors.

There will be one or two smaller agents who complain that they will now have to pay for software when they previously accessed HMRC's portal for free. But I'm afraid that I don't have much sympathy for that view. Tax software for a small practice is now very cheap, whether on the cloud (eg Taxfiler) or on the desktop (eg TaxCalc). If an agent cannot afford the low cost of maintaining basic software in the 21st century, they should consider whether they are in the right business.

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By viraljharia
23rd May 2016 14:08

HMRC should take the advantage of the relationship between Agents and clients. It will make HMRC's life easier as well because Agents are in a better position to explain to clients what is happening. Plus this will be done at no extra charge to HMRC and also save some for the Exchequer! There is a reason why clients appoint agents....

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By legerman
23rd May 2016 14:15

I am already using taxfiler for some SA returns, but I quite like the HMRC agent portal. At the moment it's only access to the DTA that we don't have, will we still have access to the current HMRC agent portal?

Obviously if Taxfiler allows access to the api, then the online portal will be redundant anyway. However, it will mean an increase in costs whichever software is used, as we can't expect the vendors to do it for nowt.

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By rosataylor
23rd May 2016 14:16

At the moment HMRC are making errors with regard to posting payments made by tax payers. I have to warn clients that their payments are not being credited as per the HMRC website. All payments are not shown and therefore showing liabilities which actually not correct.
I dont think HMRC can go digital at the time they say they would. I just dont trust them at all.

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Replying to rosataylor:
By Charlie Carne
23rd May 2016 15:37

HMRC said in last week's webinar that this is because updates to the database in the agents' portal suffer from lag compared to the database used by HMRC staff. The API, however, will apparently use the same database that HMRC staff use and we will no longer be victims of mis-matched data. This is yet another reason to welcome the API as a replacement for the agents' portal.

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By pauljohnston
23rd May 2016 14:16

This seems fine by me. As I read we will gain access via our professional softwrae and clients, if they want will do it the HMRC way.

The APIs are behind and HMRC know that if we are taken out of the loop for any length of time our clients will turn up with their logins and expect us to gain accesss. Thus HMRC will then have many potential security breaches (same PC different login credentials). So it would seem that HMRC are between a rock and a hard place and need to get their/its finger out fast

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By raybackler
23rd May 2016 14:18

My understanding is that an agent has a legal status in law. If a client appoints an agent for a specific matter then they have that legal status. Whilst no client can duck their legal responsibilities, surely when an agent is appointed that status should be recognised and not excluded by HMRC.

I agree with charliecarne that in this day and age third party software will give a better result. All accounting practices should have the wherewithal to cover the requirements, so this issue is not about being a technophobe.

There is a principle at stake here, which is a client has the legal right to appoint an accountant as their agent and no one should have the right to intervene in that process.

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By timothyvogel
23rd May 2016 14:43

I think it is a disaster waiting to happen. We can use third party software for standard taxes, but for example we only have 2 clients on CIS and 1 on Moss, and until recently only 2 on PAYE because we chose not to do that work, so use the HMRC portal for those. Now we will need third party software for all of them.
Also currently I regularly have "interesting" discussions with HMRC staff where they say the figures show 1 thing,and we say they show another. Now I can say to them that I can see their figures, and we always come to some form of agreement, but in the future will they just say,"your figures are wrong and I cannot see how you got to them" and we cannot argue as they may be different?

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By Robbo
23rd May 2016 14:55

There are many small agents of whom HMRC are not aware because instead of being properly authorised these people obtain the login details of their 'clients'. Many operate from home in addition to other jobs & don't declare their earnings. Many are 'dodgy' or have no real knowledge of what they are doing

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By Mallock
23rd May 2016 15:48

This just demonstrates that HMRC do not understand how agents and small clients interact. We are currently unable to get direct access to details of PAYE/NI payments made by clients which make reconciling these figures for the accounts very difficult when a difference arises.
Even though we may not deal with VAT or PAYE for clients and therefore don't have a mandate in place, the vast majority of clients would want us to have access to these details from HMRC should we need them: that's just the way the small business/accountant relationship works.
Limited and restricted access to online information from HMRC for agents will do nothing to improve the system for small businesses, who in the vast majority of cases just want to get it right. They rely heavily on us to help them and artificial barriers don't make that process easier or cheaper.

I have nothing against using API but fail to see why it can't give us the same information as the client would get if they logged in themselves.

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Replying to Mallock:
By Charlie Carne
23rd May 2016 15:58

But that's the point! Unlike the existing agent portal, which uses a different database and can only offer restricted access to some of the data, the API will "give us the same information as the client would get if they logged in themselves".

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By [email protected]
23rd May 2016 16:11

It appears David Gauke wants MTD to kick off in a couple of years with clients filing their own tranactional based accounts (not just headings) from their iPhones 4 times a year. This might be possible for small businesses on the cash basis but does he expect taxpayers to do 4 stock/WIP counts a year & prepare accounts on the accruals basis? Then there's the P/U adjustments to think about plus disallowables but one thing probably not worth worrying about is capex with AIA now £200k. I just get the feeling someone has made some schoolboy extrapolations from the trends in IT purchases & has come up with something which if implemented would create be the biggest mess ever & what SE clinets would pay to clean it up? Answer 100% NONE

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By Tim Robinson
23rd May 2016 16:27

There aren't any obvious responses above from the software houses on their development work, are they able to do anything before HMRC finish their API?

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By raybackler
23rd May 2016 16:34

I have just been sorting out the mess created this year on CIS for some clients.

Where they have submitted the CIS returns each month, I have had to make corrections to agree the tax year-end position to what actually went through their accounts. The clients expect me to do this, because they don't want to waste time re-submitting CIS returns.

The PAYE/CIS account balances for most clients are wrong on their online account with HMRC. The current year is generally correct, but there are errors on prior years that HMRC don't seem inclined to correct. Any client looking at their online account would have kittens. Imagine the disbelief when I tell clients that HMRC advice from their call centre is that "all prior years should be ignored on their online system".

To add insult to injury, HMRC won't confirm any figures over the phone from their 'real' internal system. The first port of call for clients and ourselves is their online account, which is a different system from what the HMRC staff look at when you phone in. It is a nonsense!

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By raybackler
23rd May 2016 17:09

CIS/PAYE - I should also have said good luck linking to the HMRC online account with the API! GIGO = Garbage In Garbage Out.

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By carolelmcarre
23rd May 2016 17:37

This is typical of the level of 'service' provided by HMRC which has been abysmal. From my perspective, being unable to access the detail shown in some areas of my clients tax accounts just results in my clients becoming confused and annoyed by incorrect demands for payments that I am unable to assist with sorting out unless I spend hours on hold on the phone. Penalties and demands that are incorrect, time wasted by me waiting to inform HMRC that their figures are incorrect and I have the proof, and time wasted by HMRC retracting penalties. I now HAVE to pay for 3rd party software, (more charges for my clients). Increasingly HMRC are shifting the burden of proof and assessment onto their 'customers' under the guise of providing transparency and choice when the reality is that our taxation systems are too complex to support this. And to help, we have dumbed down webinars where any issue other than the most simple is dealt with by the ever familiar, 'there is plenty of advice and help on the HMRC website'. Tax now takes up a huge amount of my time...and this is only going to make it worse.

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By gracegariff
24th May 2016 08:45

Where does the AOSS - Agent online self serve fit into this? I thought that was how we were going to access client information.

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Replying to gracegariff:
Tornado
By Tornado
24th May 2016 09:23

gracegariff wrote:

Where does the AOSS - Agent online self serve fit into this? I thought that was how we were going to access client information.

Can I refer you to this -

https://www.accountingweb.co.uk/any-answers/agent-services-0

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By Tarin Smillie
24th May 2016 14:10

I would like to know if this means we will how to reauthorise as an agent for every different service provided? I think HMRC are reaching thinking that clients are as organised as they seem to think they will be! In every practice I have worked in, not one clietn wants to deal with HMRC and their own tax affairs!

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Replying to Tarin Smillie:
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By pauljohnston
24th May 2016 16:17

Re-authorise every client. Looks like HMRC are about to have another 64-8 avalanche or if it is done electronically further postal problems because it cant send out the electronic certifications fast enough. I would hope for an easy system but....

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By pauljohnston
25th May 2016 16:12

As you know all civil servant departments are in perder (not sure of spelling) so cant make any announcements until 24 June.

Spoke to someone in the know and he said that HMRC has realised that if you have a large number of clients that the digital web dashboard just wont work efficiently. The API is the solution with agents being able to see the same as HMRC staff. I pointed out the problems that will now arise with clients comming to us to see their dashboard if the API is released late. The guy I spoke with took this onboard.
Having had this conversation I am very pleased. The great things about the apis is that they have to work because if they wont HMRC staff wont be able to see either. Unauthorised agents will I believe will find it much harder to operate. Regular use of the same PC with different client credentials will flag up a potential security breach with HMRC. I guess that this may mean that some Pcs will be unable to gain access.

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Replying to pauljohnston:
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By Mallock
26th May 2016 17:19

pauljohnston wrote:

As you know all civil servant departments are in perder (not sure of spelling) so cant make any announcements until 24 June.

Spoke to someone in the know and he said that HMRC has realised that if you have a large number of clients that the digital web dashboard just wont work efficiently. The API is the solution with agents being able to see the same as HMRC staff. I pointed out the problems that will now arise with clients comming to us to see their dashboard if the API is released late. The guy I spoke with took this onboard.
Having had this conversation I am very pleased. The great things about the apis is that they have to work because if they wont HMRC staff wont be able to see either. Unauthorised agents will I believe will find it much harder to operate. Regular use of the same PC with different client credentials will flag up a potential security breach with HMRC. I guess that this may mean that some Pcs will be unable to gain access.

My problem with the proposed new system is that we will have to have mandates for all taxes if we are going to do our job properly and reconcile PAYE, VAT and CIS. However if the client does their own payroll and prepares their own VAT Returns there are practical problems which arise such as the address to which HMRC post documents and the receipt of phone calls from HMRC about things we have no knowledge of.

At present there are perhaps a handful of occasions where we get clients to log on to their HMRC accounts when they are in our office, so that we can download or print out the information we need for reconciliation purposes - this will seemingly not be possible under the new system and may actually cause serious issues if tried.

What we need is the ability to get a mandate for all taxes but to be able to separate who will be dealing with the day to day administration.

Many years ago before tax specific 64-8s, that is exactly what we had and it worked really well: we could get the information we required, the client got the level of service he expected and HMRC had authorisation to talk to us about everything. Simple.

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By terrysmithemmerson
26th May 2016 14:45

Do you have a link to the webinar so I can view it?

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