UK accountants received four critical updates this week, with HMRC confirming a major system failure affecting MTD trial users just two months before mandatory rollout, while fraudulent emails targeting agents’ AML registrations showed a significant increase.
Here are the details.
Weekly News & Updates in 30 Seconds
- MTD System Failure: 4,500 trial users face payment on account problems due to split HMRC systems, raising concerns ahead of April rollout
- AML Scam Alert: Fraudulent emails targeting agents’ registration details increase; only trust emails ending in gov.uk
- Mandation Letters: Final MTD letters arriving late March/early April; agents not copied, taxpayers responsible for signing up
- April Deadline: 864,000 sole traders and landlords must use digital reporting from 6 April; no penalties first year
MTD Trial Users Hit by Payment on Account System Failure
HMRC confirmed that 4,500 taxpayers enrolled in the Making Tax Digital for Income Tax trial face problems settling their payment on account for 2025-26 due to financial information being split between two separate HMRC systems.
The issue affects both the 2024-25 balancing payment and some credits. Taxpayers’ statements are showing payments on account marked as “transferred to digital” or “nil”, requiring users to access both their MTD Income Tax account and self assessment account simultaneously through their personal or business tax account to view complete payment information.
HMRC wrote to affected taxpayers before the 31 January deadline explaining the problem and providing instructions. The tax authority confirmed it will not charge late payment penalties to trial users, but interest will still accrue on late payments on account.
Around 4,500 trial participants received letters informing them where to find their payment on account information and advising them to contact the specialist MTD trial support team (0300 322 9619, Monday to Friday 8am-6pm) if they need help.
HMRC Warns Agents of AML Registration Scam
HMRC reported an increase in fraudulent emails asking agents to update their anti-money laundering supervision registration details.
The tax authority is advising agents to access HMRC online services by going directly to GOV.UK rather than clicking links in emails. Genuine HMRC emails are sent from addresses ending in gov.uk, specifically:
- @hmrc.gov.uk,
- @tax.service.gov.uk,
- @advice.hmrc.gov.uk, and
- @updates.hmrc.gov.uk.
Agents should report any suspicious contact to HMRC immediately.
These scam emails are separate from genuine letters HMRC sends periodically asking agents to confirm who supervises them for AML regulation purposes. Agents must respond to genuine AML correspondence from HMRC as failure to do so could result in losing access to HMRC services.
Final Batches of MTD Mandation Letters Being Sent
HMRC will send the final batches of mandation letters informing taxpayers they must comply with MTD for Income Tax from April 2026 based on information in their 2024-25 self assessment tax return.
Letters will be sent in two waves:
- This week: taxpayers who submitted returns between 1 September and 30 November 2025
- From mid-March 2026: taxpayers who submitted returns from 1 December 2025 onwards
Each mailing takes two weeks to complete, meaning some taxpayers may not receive letters until late March or early April. Agents will not receive copies of the letters.
Total income from sole trades and property businesses exceeding £50,000 in 2024-25 triggers MTD requirements from April 2026, subject to available exemptions. Each taxpayer must confirm their eligibility status and complete the sign-up process themselves.
The letter has been updated since the first mailing in November 2025 to reflect the Autumn Budget 2025 announcement that no penalties will be charged where any of the first four quarterly updates are submitted late.
MTD Launch: Key Details
From 6 April 2026, 864,000 sole traders and landlords earning over £50,000 from self-employment and property must use recognised software for digital records and quarterly updates.
Customers joining MTD in April 2026 will not receive penalty points for late quarterly updates during the first 12 months. After this period, penalty points are given for each late submission, with a £200 penalty applied once four points are reached.
Free software options are available that generate simple summaries to send to HMRC once income and expenses are recorded. Use the FigsFlow Making Tax Digital Calculator to check if your clients fall within scope from April 2026.
Plan Ahead
- 6 April 2026: MTD for Income Tax mandatory start date for qualifying income over £50,000
- 7 August 2026: Q1 quarterly update deadline for those joining MTD in April 2026
- 7 November 2026: Q2 quarterly update deadline
Information compiled from ICAEW tax news and HMRC press releases published during the week ending 5 February 2026.
