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Multi-agent Access For MTD For Income Tax

01 - 08 - 2025

Making Tax Digital (MTD) for Income Tax is fast approaching, with the mandation date for sole traders and landlords with qualifying income of £50,000 and above set firmly at 6.4.26.

In addition to the annual tax return, those mandated to comply with the MTD IT requirements will need to submit cumulative quarterly updates of their income and expenses to HMRC and maintain digital records of their transactions using HMRC-approved software. Multi-agent access will allow taxpayers to appoint a main agent to deal with their tax return at the year end and one or more supporting agents to deal with the record keeping and quarterly updates.

 

The supporting agent, for example a bookkeeper or letting agent, will be more restricted in the tasks they can carry out on your behalf. The main agent will be able to do almost everything that you, the taxpayer, can do. Where a taxpayer has income from property and separate trading income they may choose to appoint different supporting agents for each. It will be possible to appoint multiple supporting agents but only one main agent to oversee your tax affairs and deal with your annual tax return.

 

When appointing a supporting agent, be careful not to designate them as the main agent as doing so will automatically remove the existing agent's access. This may lead to delays in your year end tax return and potential penalties for late submission.

 

We have been preparing for some time to help clients navigate the MTD IT requirements. We can lead you through the process of deciding where best to use (or not use) supporting agents to optimise your MTD processes. Contact us on 01244 625 500 or contactus@foremansllp.com for free initial advice and further information on how MTD may apply to you. 

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01244 625 500

Fixed Data

Assumptions

General                                                                                                                              

• The user is over 21 and subject to tax in the UK
• The user wishes to minimise their tax liability
• The user is subject to national insurance i.e.he/she is not over retirement age
• Only current tax rates and limits are applied
• No tax mitigation payments are made e.g. pension contributions
• Only 3 digit letter 'L' tax codes shown in the drop down list can be entered 
• The user does not have a turnover greater than £100,000 where fewer reliefs and or higher taxes may apply

Expenses

• All miles claimed as expenses are for business use using a personally owned car or van
• All other expenses claimed are wholly, necessarily and where appropriate exclusively for the benefit of the business

Foremans LLP Charges

• Foremans fees associated with Limited Company, Sole Trader or Umbrella are as per published rates
• Foremans current Service Costs are allowed for in all calculations.

Holiday Pay

• Holiday pay is accumulated week by week by Umbrella or Agency employer but paid out during the year

VAT

• Limited Company or Sole Trader will be VAT registered
• Limited Company or Sole Trader will take advantage of Flat rate VAT
• Flat rate applied includes the benefit of the additional 1% applicable to the first year of VAT registration

Limited Company Conditions

• One director / one shareholder in a Personal Service Company
• Director of Personal Service Company elects to vote for 100% dividend after salary, costs and expenses
• Director's salary is maximum salary to the primary threshold for NI
• The Limited Company is trading normally i.e it is not subject to IR35 and is not a Managed Service Company

NOTES

• The Current tax rates are taken from the Fixed Data Table
• The current Value Added Tax Rate is 20% and is applied to all invoices and expenses as appropriate
• The Director's Salary is fixed in relation to National Insurance thresholds. Higher Rate Taxpayers should consider the advantages and disadvantages of a larger annual salary or bonus
• Higher Rate Taxpayers may wish to consider the advantages and disadvantages of shared ownership of their business
• Users with a tax code other than three digits and letter "L" may telephone or email our Development Department to request a detailed calculation
• Generally the use of an Umbrella rather than an Agency payroll is only efficient if sufficient weekly expenses are allowable and claimed
• The expenses claimed under an Umbrella should not prevent the proper operation of National Minimum Wage