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 need to provide them with the authority to deal with HMRC on your behalf. So, how does this authorisation process work in practice?
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
- PAYE (payroll)
- Self Assessment (and other personal taxes)
- Construction Industry Scheme (CIS)
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 is still the preferred method for many firms. 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 either scan back the signature page to your accountant to finish the application process or post back the form directly to HMRC if you’re able to populate all of the fields yourself.
b) Your accountant sets you up online
Your accountant can apply for online access to your limited company’s taxes via their HMRC Agent account.
For each tax, this will generate a code which will be posted out to your company’s registered address.
Once you receive the code, tell your accountant, and this will complete the agent authorisation process.
This usually takes a week or so. Make sure you let your accountant know asap, as each code has an expiry date – typically 30 days from issue. You’ll have to start the process again if you don’t act fairly swiftly, especially when the postal service is ‘under strain’.
c) You authorise your accountant via the Government Gateway
You can also grant authority to your accountant yourself, if necessary.
However, firstly, you need to register your limited company for HMRC Online Services. You can do this here.
You then will need to select the taxes you want your accountant to deal with on your behalf from your Business Tax Account.
HMRC will post codes to your company registered office address for each tax – in the same way as detailed in option b) above.
Finally, after completing all of these steps, you will be able to appoint an agent to act on your company’s behalf – for each type of tax (CT, VAT, PAYE, and potentially Self Assessment for directors).
d) Digital Handshake – available for certain taxes only
For certain taxes, there is another online method to provide your accountant with the authority to deal with HMRC. This is known as a ‘digital handshake’.
Currently, this is only used for Making Tax Digital (MTD) for VAT, and personal taxes.
For VAT, your accountant may send you a link via email, which will allow them to link your account to their online dashboard.
For all other taxes, authorisation methods a), b) and c) apply.
How to remove authorisation from an agent
You may need to remove authorisation from an accountant in the future – typically when you change firms.
Change or remove access online
If you have online access to your HMRC Business Tax Account (see above), you can remove an agent from a specific tax whenever you wish. You can replace them with your new adviser’s details provided you have their agent code to hand.
Change or remove access offline
If you don’t have access to HMRC online services, you can still make changes or remove an agent, although the process is a little more cumbersome.
You can contact HMRC via phone or post. Read the details here.