The main job of an accountant is to look after your limited company’s tax affairs. When you sign up with a new firm, you must give them the authority to deal with HMRC on your behalf. So, how does this authorisation process work in practice?
To let your accountant deal with HMRC, you must authorise them as your agent for each tax. How you do this depends on the tax involved. HMRC currently uses several methods, including online agent authorisation, your Business Tax Account, digital handshake and form 64-8.
Permission is given via HMRC’s agent authorisation process. This grants an accountant or tax adviser permission to act on your company’s behalf and deal with:
- Corporation Tax
- VAT
- PAYE (payroll)
- Self Assessment (and other personal taxes)
- Construction Industry Scheme (CIS)
If you’re in the process of choosing a contractor accountant, it’s worth understanding how this works from the outset.
| Method | Speed | Typical use |
|---|---|---|
| Online Agent Authorisation | Usually around a week where a code is posted | Corporation Tax, PAYE, Self Assessment and some other taxes |
| Paper form 64-8 | Slower | Corporation Tax, PAYE, Self Assessment and some other taxes |
| Business Tax Account | Online | PAYE, CIS, VAT and certain other taxes |
| Digital handshake | Online | VAT, MTD for Income Tax and certain other tax services |
How to appoint an accountant – online and offline
There are several ways to authorise an agent – both offline and online.
a) Submit a paper form 64-8
This is the paper form used to authorise an agent. It will be familiar to anyone who hired an accountant in the pre-digital age. It can still be used for taxes including Corporation Tax, PAYE and Self Assessment. You can view a copy here.
Your accountant will typically pre-fill in the required fields on your behalf. If not, you will need to know your company and personal tax reference numbers first, as well as your accountant’s details and agent codes.
Once you’ve signed, you can either scan the signature page and send it back to your accountant to finish the application process, or post the form back directly to HMRC if you can populate all the fields yourself.
b) Your accountant sets you up online
Your accountant can apply for online access to certain taxes via HMRC’s Online Agent Authorisation service.
For taxes which use this method, HMRC generates an authorisation code, which is posted to you.
Once you receive the code, tell your accountant, and the agent authorisation process can be completed.
HMRC says authorisation codes are normally received within around seven working days. Make sure you let your accountant know as soon as possible, as each code expires after 30 days from issue.
You’ll have to start the process again if you don’t act promptly, especially if there are postal delays.
In practice, delays often occur at this stage — either because the authorisation codes are missed in the post or expire before being used. It’s worth keeping an eye out for HMRC letters once the process has started.
c) You authorise your accountant via the Government Gateway
You can also grant authority to your accountant yourself for certain taxes through your HMRC Business Tax Account.
However, firstly, you need to register your limited company for HMRC Online Services. You can do this here.
You can currently authorise an agent through your Business Tax Account for taxes including PAYE, CIS and VAT.
For Corporation Tax and Self Assessment, HMRC advises you to speak to your accountant about the appropriate authorisation method.
To use your Business Tax Account, your accountant will give you their Agent Government Gateway Identifier. You can then select the relevant tax and add the accountant as your agent.
d) Digital Handshake – available for certain taxes only
For certain taxes, an alternative online method allows your accountant to deal directly with HMRC. This is known as a digital handshake.
This method is used for a growing number of HMRC services, including VAT and Making Tax Digital for Income Tax, although availability depends on the specific tax.
Your accountant sends you an authorisation link. You follow the link, sign in using the details for the relevant tax service and approve the request.
The link expires after 21 days, so if you don’t respond in time your accountant will need to send you a new one.
For other taxes, one of the other authorisation methods above may apply.
How to remove authorisation from an agent
You may need to remove authorisation from an accountant in the future – typically when you switch accountants.
Change or remove access online
If you have online access to your HMRC Business Tax Account or Personal Tax Account, you can remove an agent online for many taxes. The exact process depends on the tax and how the accountant was originally authorised.
If you appoint a new agent, a new authorisation will replace the existing authority for that tax.
Change or remove access offline
If you can’t remove the agent using HMRC’s online services, you can still ask HMRC to remove their authority.
You can contact HMRC via phone or post. Read the details here.
In most cases, your accountant will handle this process for you, but it’s still worth understanding how it works — particularly if you ever need to switch firms or revoke access.