HMRC is changing the way it deals with tax agents who phone in to request information on behalf of a client. The new system will be in place from 1 May 2017.

Although a client may have given you, their tax agent, permission to act on their behalf, from 1 May, HMRC will not give you any information about your client over the phone. Instead, the information will be sent direct to your client, by letter, at their last known address and you will not receive a copy of the letter.

HMRC’s reason for their change of practice is that it will reduce call handling costs and improve security for tax payers. Every year, HMRC receives 2.7 million phone requests for tax details, many of which come from tax agents. HMRC staff have become increasingly concerned that the percentage of callers impersonating a taxpayer is increasing. In addition, there are instances when a taxpayer is not aware that they have signed an authorisation form and/or a deed of assignment giving their accountant permission to deal with tax repayments.

Tax professionals are concerned that HMRC’s new ruling may be breaking the spirit of the taxpayer’s Charter. This states that a taxpayer may appoint an accountant or relative to act on their behalf, and providing that authority is in place, they may contact HMRC. However, from 1 May, HMRC will not deal with a tax agent by phone, even though they have their client’s permission to act on their behalf.

Accountants ringing the Agent Dedicated Line (0300 200 3311) on or after 1 May, will hear a short recorded message explaining the changes. HMRC is in the process of writing to 5,000 tax agents informing them of the new ruling and there will be details available in appropriate accountancy journals.

By summer 2017, HMRC expects to have a digital solution in place so there will be no need for tax agents to make phone calls on behalf of their clients. However, it is not yet known if all agents will be allowed access to the system or what level of security will have to be in place.