WARM UP ACT
As is obvious from the title, this article considers the new “Prohibition against unregistered tax advisers interacting with HMRC”.
What? It wasn’t obvious?
Ok, well, from 18 May 2026, if you’re paid and you interact with HMRC about someone else’s tax affairs, your legal entity needs to register unless an exemption applies.
This being part of the package of measures (Part 7 of Finance Act 2026) being aimed at “tax advisers” if one also includes the “conduct rules”. The registration rules being Chapter 1 of Part 7 and the conduct rules being in Chapter 2.
This article – a two-part Elvis Vegas festival of tax – is concerned purely with chapter one. If my actions are at least equal to my intentions, I will also bash an article out on the chapter 2 conduct rules too. Aren’t I nice?
But these rules aren’t perhaps what they seem. Just like a fat bloke in a onesie and a quiff isn’t necessarily the real Elvis (he’s dead, get over it), these new rules aren’t quite what they’re cracked up to be.
Hear me out.
The Manic Street Preachers’ monster album, Everything Must Go, opens with track that creates visions of a towering Elvis impersonator on a tired seafront. An American icon, reproduced at scale… but, sadly, all surface and no substance.
Swap the jumpsuit for a slick website and a “guaranteed refund” ad, and you’ve got a useful metaphor for where HMRC (and, to be fair, many others) thinks the tax advice market has a problem.
We are likely not talking about advisers and practices that are members of the larger professional bodies… but the cheap, and often nasty, impersonators.
So, put down that hamburger, change out of that uncomfortably tight jumpsuit, and let’s look at these new measures with a suspicious mind.
Uh-huh.
ACT ONE: THE WHY…
First of all, before we tuck in, let’s look at who these proposals are (and aren’t) aimed at.
“20 foot high on Blackpool promenade”
It is perhaps well rehearsed that there are a number of different types of bad actors in the tax space.
First of all, I am going to suggest it includes the ‘20-foot high’ advisory impersonators that a short visit (the best type of visit, in my experience) to Instagram or Facebook will reveal in all of their glory.
At the moment, you can see numerous opportunities to claim your ‘guaranteed VAT refund’ (despite the absence of any understanding of your business).
It could easily be a guaranteed corporation tax refund.
Or perhaps you could make a claim (guaranteed, of course) for your work clothing etc?
You get the gist.
In my opinion, it’s very much these types of business that are very much the main focus of these rules.
“Limited face-paint, dyed black quiff”
Additionally, I present to you the overnight “specialist”.
For example, an SDLT refund ‘specialist’ that, until quite recently, might have told you that your garage is really a separate dwelling…and not just for that infestation of spiders.
An R&D claim ‘specialist’ might tell you that your newly curated vegan menu demonstrates an appreciable advance in science and / or technology.
There is the experienced lawyer who specialising in estate planning telling you the answer is to put your house in trust (before you’ve asked any question). But he isn’t a lawyer… and his experience is in marketing / double-glazing sales.
These people are not specialists… they are singularists. They only do one thing. And, in this context, not very well…
So, yes, limited face paint. Quiff entirely optional.
[Of course, there are proper specialists / subject matter experts out there. Ones with lots of experience, qualifications and shiny awards. I’m not talking about them. I love that type of specialist].
These might be the second, more peripheral target of the rules.
“Overweight and out of date”
Of course, there has been a historical industry of marketed tax avoidance, including profit extraction, corporation tax planning, SDLT etc.
Perhaps the dying embers of this industry being the contractor loan planning (and similar) being run through umbrella schemes (arguably, new rules coming in over the next few days should finish this for good).
Generally speaking, other than when it came to handling the many tax disputes they created, these businesses did not generally interact with HMRC. The one significant exception perhaps being umbrella based schemes, which would usually have an employer reference and would have PAYE filing obligations.
On the basis that this sector is pretty much dead, and as a result of much more aggressive powers already given to HMRC, this would be an extra, alebit pretty weak, solution to an all but historic problem.
That said, these new rules will have some effect. As we will see, if they have had certain powers in connection with tax avoidance used against them recently, they may find they are not allowed to register for a limited period.
“Fake royalty second hand sequin façade”
There are two different types of ‘royalty’ I reference here.
The first is HMRC. Ultimately, they will preside over this new empire of registered tax advisers.
Arguably, the rules come from a standpoint that HMRC are reasonable and will be fair arbiters of conduct. Of course, they are not. It is perhaps stating the obvious that, in each and every tax dispute, HMRC will have a dog in the fight. Even if only presentational in nature, there is a clear conflict in having a non-independent quasi-regulator of tax advisers.
The second set of royalty are the professional bodies. Arguably, these rules have the result they have been emasculated by a layering of additional requirements upon those already created by the professional bodies.
Of course, the members of those professional bodies are not the real target of these rules. They are largely targeted at non-compliant, feral advisers. Of course, there is an inherent difficulty in trying to legislate into compliance those who habitually ignore rules and regulations! A pessimistic commentator might say this is simply more admin for those who are already compliant.
ACT TWO: THE ‘WHAT’ AND THE ‘HOW’
The new regime is in the shiny new Finance Act 2006, ss 220-246 (plus Schedules 19 and 20).
Perhaps the fact that HMRC had already published operational guidance before the Finance Bill received Royal Assent reflects the momentum with which this is all being introduced.
The stated policy objective is to create a legal “floor” for anyone who is paid to act for a person to be able to interact with HMRC.
So, firstly, this is not about establishing a wider set of principles for tax advisers. Instead, it is about inserting a gatekeeping requirement before anyone may gain access to HMRC:
…A tax adviser may not interact with HMRC in relation to the tax affairs of a client unless
(a)the adviser is registered under this Chapter, or
(b)an exception in Schedule 20 (exceptions) applies[1].
What constitutes interaction?
(2)A person interacts with HMRC if the person does or attempts to do any of the following—
(a)contact HMRC by telephone, post or email;
(b)send a message to HMRC through a website or internet portal;
(c)file a return, claim, notice or other document with HMRC (whether electronically or otherwise);
(d)communicate with HMRC in any other way.
It should be noted that there is no jurisdictional limit to these rules. As such, they apply if the client and / or the agent is based outside of the UK.
Those who need or wish to register must meet a set of conditions.
As such, this is not really about “regulating tax advice”. This is in no real attempt to create a bellwether in terms of the quality of advice, qualifications, or professional conduct[2] in the sense that a “regulator” might.
The trigger is based on interaction with HMRC and not “being a tax adviser” in any natural sense of the term.
Indeed, not all tax advice requires interaction with HMRC and not all interaction, as defined, is tax advisory in nature.
For now, in summary, the ‘how’ is:
“Interaction with HMRC” + Get paid for it = Registration
ACT THREE: THE ‘WHEN’
Thankfully, there is no absolute cliff-edge date and the registration requirement will be phased in to some extent.
From 18 May 2026, HMRC introduces an online registration system for Agent Services Accounts, replacing the current process.
This is also the reference point by which a handful of staged start dates from which you’re required to register:
- From 18 May 2026 for most in-scope advisers;
- From 18 August 2026 if you already have a Self-Assessment or Corporation Tax account (but not an ASA);
- From 18 November 2026 if you only provide third-party payroll services and do not interact with HMRC in other ways.
There is a 3‑month registration period from the date you’re required to register, during which (and while an application is being processed) the adviser can continue interacting
ACT FOUR: THE SO WHAT?
So, what happens if you decide this is ‘one-list’ on which you don’t want your name?[3]
Well, firstly, if you don’t register then you can’t interact with HMRC. This, at first glance, might sound like heaven. However, realistically, for most tax advisers, running a business without filing a tax return, responding to a HMRC letter, or waiting on hold to speak to some on the Self-Assessment helpline, will be a bit of a challenge!
If you attempt to interact but have not registered, then HMRC may issue a notice to stop, may ban you from registering, and may charge a penalty if you continue after a stop notice.
Not an ideal result.
On the other hand, getting on the register doesn’t mean you can behave like you’ve got an all‑access wristband forever.
HMRC can suspend registration if you stop satisfying the conditions (these are discussed in the next section) or if your interactions fall below the standards HMRC reasonably expects.
Suspension can be indefinite until conditions are fixed, or up to 12 months for specific conduct issues.
There are appeal rights, but suspension may still bite while you appeal (subject to limited temporary relief), which makes this commercially serious rather than just “admin”.
Indeed, there are some financial teeth backing up the regime with penalties of £5,000 after a compliance notice and £10,000 for repeat contraventions (and potential exposure for certain individuals inside the organisation).
There is also the potential for some client-notification obligations to arise in some cases.
ACT FIVE – THE ‘WHO’
Registrable activity
As stated above, the trigger under this legislation is not the ‘giving of advice’ but is based wholly on interaction with HMRC.
This perhaps, certainly to the lay person, might seem odd and also, perhaps relatedly, gives rise to the quirks.
So, a tax adviser is broadly a person (organisation or individual) who assists others with their tax affairs.
A non-exhaustive list of examples might be as follows:
- It would include an accountant submitting a self-assessment tax return on behalf of an individual (or corporate tax return on behalf of a company).
- It would include an agent who does nothing but make claims (marriage allowance, work clothing etc) on behalf of taxpayers.
- It would include an agent making R&D claims on behalf of their clients.
- It would include a conveyancer submitting SDLT returns, who is clearly “interacting”, so in-scope.
- It would include an adviser applying for clearance for a corporate transaction.
- It would include a tax dispute resolution who is acting on behalf of a client making a disclosure to HMRC.
- However, for an adviser giving estate planning / IHT advice with no need to contact HMRC (and never submits forms/returns) is likely out-of-scope.
- It would not include an adviser who provides advice in relation to a transaction which does not require, say, a clearance, claim or any other disclosure to HMRC.
In-house teams have a few potential wrinkles once you get beyond the surface. I will look at these in Part Two (what a cliffhanger, eh?)
The process
HMRC’s published approach is that the legal entity doing the interacting must register. As such, it is the company / LLP / partnership / sole trader that is required to be added to the register rather than each employee.
However, HMRC will also check certain “relevant individuals” within that entity.
So, who are these lucky individuals?
Well, it depends on whether the organsisation has:
- less than six officers; or
- has six or more officers
Where the organisation is in the former category, a relevant person is any individual who works for the tax adviser and who plays a significant role in the decision-making of the business (or part of it), or has a significant role in the actual managing or organising of the whole or a substantial part of those activities.
In addition, each officer of the tax adviser who is not within either of the categories above is also a relevant individual.
Where an organisation has six or more officers, then the categories are broadly the same. However, if there are not at least 5 officers who fall within these two categories, then they must nominate a number of officers so that there is a quorum of at least 5 officers named as relevant individuals.
For a company, officer means director. For a partnership, it means partner.
Overseas advisers (or overseas “relevant individuals”) are flagged for extra friction and need to provide notarised / authenticated evidence and certified English translations may be required.
The “minimum standards”
General
So, what are the “minimum standards” required here?
These are expressed as three registration conditions[4] that must be satisfied by the tax adviser (as defined above):
First registration condition
This applies to both the tax adviser and, if the adviser is an organisation, each of the adviser’s relevant individuals.
The requirements are that both the adviser, and any of its relevant individuals:
- do not have a relevant amount overdue or a relevant return outstanding,
- are not subject to a decision by HMRC to refuse to deal with them,
- are not subject to a relevant anti-avoidance measure,
- have not, in the previous 12 months, had a relevant anti-avoidance penalty imposed on them,
- are not subject to a relevant suspension (under this regime) or a relevant ineligibility order,
- are not disqualified under the directors disqualification legislation or subject to a similar disqualification in a territory outside the United Kingdom,
- do not have an insolvency practitioner acting in relation to them, and
- do not have an unspent conviction for a relevant offence
In respect of (1) above, a “relevant amount” is broadly tax or NICs owed to HMRC, a civil penalty resulting to tax or outstanding interest[5]. However, a relevant amount is not overdue if it is subject to a time to pay agreement that has not been broken.
As such, it will be necessary for a relevant individual to be up to date with their personal tax affairs, else jeopardise the company’s registration status.
For the purposes of (3) above, a person is subject to a “relevant anti-avoidance measure” if:
- the person is subject to a stop notice;
- the person is subject to a monitoring notice;
- They have been named and shamed (and the information has not been withdrawn) under:
- The penalties for enablers of defeated tax avoidance and the information has not been withdrawn;
- information identifying or about the person has been published under the POTAS rules.
In respect of (4), a “relevant anti-avoidance penalty” means a penalty under any of the following:
- failure to comply with a stop notices;
- enablers of defeated tax avoidance;
- under the ban on promotion of certain tax arrangements;
If a relevant anti-avoidance penalty is imposed on a person and the penalty is at any time subsequently set aside or otherwise cancelled, the penalty is to be treated from that time as if it was not imposed on the person.
The second and third condition
Generally, the second registration condition is that the adviser only is registered with a supervisory authority for the purposes of anti-money laundering supervision.
The third registration condition is that, where the adviser is an organisation with six or more officers etc, the adviser has nominated as many officers to be relevant individuals as are necessary to ensure that the adviser has at least five relevant individuals who are officers.
—
In Part Two, I will look at, in the words of the King, whether this legislation will “take care of business”.
Watch this space.
—
[1] Exceptions: the “limited exemption” list (Schedule 19)
As stated above, one does not need to register if one would otherwise have to, but meet one of the limited exemptions, with the following generally not needing to register:
- in-house payroll for own staff;
- only dealing with tax affairs within your own corporate group;
- free advice (charity / helping friends/family);
- situations where the law requires interaction even if paid – examples given here includes insolvency practitioners and some pension / Investment firms;
- responding to an HMRC request for information;
- software providers who don’t interact with HMRC;
- and some specific capacity-limited roles
[2] I will discuss the “conduct rules” in chapter 2 of Part 7 in a later article
[3] There are perhaps limited tangible reasons for resisting. For example, the conduct rules in chapter 2 apply to a more natural definition of tax adviser than in chapter 1 (just to keep things simple!) That said, some might have a practice with such limited interaction with HMRC that a (paranoid?) sense of being at the mercy of HMRC is one that is best avoided.
[4] Finance Act 2026, s227
[5] It also includes corresponding taxes / penalties etc outside of the UK