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SCHEDULE OF SERVICES

This schedule should be read in conjunction with the engagement letter and the standard terms and conditions.

MAKING TAX DIGITAL FOR INCOME TAX (MTD for income tax) 

Initial sign up

You are responsible for signing up for Making Tax Digital for income tax (MTD for income Tax). If you wish us to assist you in signing up with HMRC, we will be pleased to assist you in the MTD for income tax signing up process. You should notify us of your instruction to assist you in your MTD for income tax sign up in good time before the first quarterly return is due. We will not be responsible if you fail to notify us within a reasonable time and you incur a penalty as a result. By signing up, you are agreeing to HMRC’s terms of participation, which include deadlines and associated penalties.

Recurring compliance work – tax

We will keep records to meet the digital record-keeping requirements of MTD for income tax. You must provide us with confirmation that the data provided to us is complete and accurate.

Where you, or a third party, prepare or retain the records, we may need to confirm that the process for performing the digital record keeping is of an appropriate standard to meet the requirements of MTD for income tax. You are required to provide the information that we may request to understand whether HMRC’s digital record-keeping requirements have been met. Where your digital records are incompatible with our software, we will agree with you an appropriate solution, and this may require an additional fee.

We will prepare your MTD for income tax quarterly updates on a quarterly basis. We will require your records within a reasonable time after the quarter end and therefore, for the first quarter, this will be the quarterly update for the period.

We will submit your quarterly MTD for income tax updates online to HMRC after the data to be included therein has been approved by you.

We are not responsible for considering or applying for any of the exemptions from MTD for income tax. However, if you feel that you are eligible for exemption, please let us know. We are happy to discuss this and may correspond with HMRC on your behalf if needed, or we can guide you on whom you should contact for this.

We will advise you of any relaxations applicable in relation to the digital records. Where the requirements are impossible, impractical or unduly onerous we will seek to reach agreement with HMRC on a specific relaxation, but this may be subject to an additional fee.

Ad hoc queries by way of telephone and email enquiries are not routine compliance and may result in additional fees. As indicated below, where appropriate we will aim to discuss and agree additional fees, but it may not always be possible to agree these in advance and we reserve the right to charge you an additional fee for these queries.

Changes in the law or practice or in public policy

We will not accept responsibility if you act on advice given by us on an earlier occasion without first confirming with us that the advice is still valid in the light of any change in the law, in practice, in public policy, or in your circumstances.

We will accept no liability for losses arising from changes in the law, in practice, or in public policy that are first published after the date on which the advice is given.

Your responsibilities

 It is your responsibility to keep proper accounting records that disclose with reasonable accuracy at any particular time the financial position of the business. It is also your responsibility to safeguard the assets and to take reasonable steps for the prevention of and detection of fraud and other irregularities with an appropriate system of internal controls.

You are also responsible for making available to us, as and when required, all accounting records and all other relevant records and related information.

You will also be responsible for:

• Maintaining records of all receipts and payments of cash.
• Maintaining records of invoices issued and received.
• Reconciling balances with the bank statements.
• Preparing a record of business mileage undertaken in the year.
• Preparing a record of hours per month worked at home if you wish to claim for business use of your home.
• Preparing details of any loan interest paid.
• Preparing a record of capital introduced; and
• Preparing details of the following at the year-end: stocks and work in progress, fixed assets, amounts owing to creditors, amounts owing by customers, and accruals and prepayments.

Where we are keeping your digital records for the purposes of MTD for income tax, you are responsible for providing us with the following information: 

• Sales invoices 
• Purchase invoices 
• Bank statements 
• Details of bank and cash payments 
• Details of bank and cash receipts 
• Work-in-progress details 
• Access to your accounting records. 

We have also agreed that you will provide the following: 

• A record of the amounts owed to the business 
• A record of amounts owed by the business 
• A list of accruals
• A list of prepayments 
• Private-use adjustments

You will be responsible for keeping records in a format that meets the digital record-keeping requirements of MTD for income tax. You must ensure that the data provided to us is complete and accurate.

You must provide us with confirmation that your digital records meet HMRC’s digital record-keeping requirements.

It is also your responsibility to ensure your MTD for income tax updates are submitted on a quarterly basis online to HMRC and provide us with your digital records to assist with the preparation of your year-end tax returns.

You are legally responsible for:

• Ensuring that your year-end tax returns are correct and complete and in an appropriate digital format and capture the appropriate level of data.
• Ensuring that your record-keeping system is compliant with the new requirements for the digital recording and transfer of data.
• Filing any quarterly updates and year-end tax returns by the due date; and
• Paying tax on time.

Failure to do this may lead to penalties and/or interest.

Taxpayers who approve their quarterly updates and year-end tax returns cannot delegate this legal responsibility to others. You agree to check that returns that we have prepared for you are complete before you approve them.

To enable us to carry out our work, you agree:

• That all quarterly updates are to be made on the basis of full disclosure of all sources of income and charges, and that all year-end tax returns are to be made on the basis of full disclosure of all sources of income, charges, allowances and capital transactions.
• To provide all information necessary for dealing with your affairs, including the accounts information outlined above; we will rely on the information and documents being true, correct and complete, and will not audit the information or those documents.
• To provide full details of all UK residential property disposals, including associated costs/valuations prior to disposal. Where you consider that you will be non-UK resident in the tax year of disposal, full details of all UK property disposals (residential and non-residential) and disposals of shares in UK property-rich companies or UK property-rich collective-investment vehicles, or such other entities, must be advised prior to exchange of contracts or agreement to transfer shares or units. If information is received after this, we cannot guarantee that we can provide advice on the amount of capital gains tax due or submit an in-year return within 60 days after the completion date of the disposal.
• To authorise us to approach such third parties as may be appropriate for information that we consider necessary to deal with your affairs.
• To provide us with all the records relevant to the preparation of your quarterly updates as soon as possible after the period ends. We would ordinarily need a minimum of 7 days before submission to complete our work. If the records are provided later or are incomplete or unclear, thereby delaying the preparation and submission of the filing, we accept no responsibility for any penalty that may arise.
• Where a quarterly or annual submission obligation is missed, this may incur a penalty point according to HMRC’s points-based system for late filing. Once the points threshold has been reached, a financial penalty may apply. Should you wish us to assist in reviewing and appealing the penalty point or financial penalty, you should notify us of your instruction and confirm the grounds for the appeal a minimum of 7 days before the appeal deadline. Where instructed by you, we will make an appeal in the form and manner required by HMRC.
• To provide us with information in sufficient time for your tax return to be completed and submitted by the due date following the end of the tax year. In order that we can do this, we need to receive all relevant information within a reasonable time frame. Where feasible, we may agree to complete your return within a shorter period but may charge an additional fee for so doing.

You will keep us informed of material changes in your circumstances that could affect your tax liability. If you are unsure whether the change is material or not, please let us know so that we can assess its significance.

Where you wish us to deal with HMRC communications, you will forward to us all communications received from HMRC such as HMRC statements of account, copies of notices of assessment, tax codes and letters. These must be provided in time to enable us to deal with them as may be necessary within the statutory time limits. It is essential that you let us have copies of any correspondence received because HMRC is not obliged to send us copies of all communications issued to you.

If you provide services, or make distance sales of goods, to private consumers in the European Union, you are responsible for either registering for VAT in that member state or registering for the VAT One Stop Shop (OSS).

You are responsible for monitoring your monthly turnover to establish whether you are liable to register for VAT. If you do not understand what you need to do, please ask us. If you exceed the VAT registration threshold and wish us to assist you in notifying HMRC of your liability to be VAT registered, we will be pleased to assist you in the VAT registration process. You should notify us of your instructions to assist in your VAT registration in good time to enable a VAT registration form to be submitted within the time limit of one month following the month in which you exceed the VAT registration threshold in force at that time. We will not be responsible if you fail to notify us in time and incur a late-registration penalty as a result.

You are responsible for employment taxes, pensions (including auto-enrolment) and the assessment of the tax status of your workers. If you do not understand what you need to consider or action you need to take, please ask us. We will not be in a position to assist you in complying with your responsibilities if we are not engaged to provide such a service. We are not responsible for any penalty that is incurred.

Our services as detailed above are subject to the limitations on our liability set out in the engagement letter and in our standard terms and conditions of business. These are important provisions that you should read and consider carefully.

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Disclaimer: This template is provided for general guidance only and does not constitute legal, regulatory, or professional advice. Users should tailor its content to their own firm’s practices and procedures, and are strongly encouraged to consult qualified legal and compliance professionals to ensure full compliance with applicable laws, regulations, and professional standards.