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As the use of HMRC's online services by tax advisers to handle their clients’ tax affairs continues to grow, the department has stressed the importance of advisers protecting their login details (user ID and password), which allow access to a practice’s registered client base.
The Revenue warned that fraudsters may be able to generate false repayments and direct them to third parties without the knowledge of the taxman, the agent or the client, were details to fall into the wrong hands.
HMRC have added the following words of advice to the ‘agents and tax advisers’ section of their website.
‘Each year, a very small number of tax agents’ credentials are compromised, potentially leading to fraudulent activity and significant financial loss to the Exchequer. HMRC continually monitor this, and intervene directly to support the agents affected and get them back to normal secure business with the department.
‘A key part of the procedure to reinstate an agent’s credentials is changing the agent’s passwords. Where agents do this for themselves, it causes no interruption to their business with HMRC, but if HMRC have to do it for an agent, the agent can be “locked out” of their accounts for a period of up to seven days. For this reason, as part of supporting agents who have been affected, HMRC help and encourage them to change their own passwords, and the vast majority do so easily and promptly.
‘There are however a small number of compromised agents who fail to change their passwords when asked, leaving them vulnerable to further fraudulent activity and the Exchequer to further financial loss. In these cases, HMRC will in future ultimately change the password directly, leading to the lock out consequences set out above. HMRC will only take this action where the agent refuses to change their password, or fails to do so when asked, or where three attempts to make initial contact with the agent have been unsuccessful. This is clearly something agents would want to avoid, especially if it were to happen close to the 31 January self assessment filing deadline.
‘HMRC recommend that, for security reasons, agents regularly change their Government Gateway password. This should be undertaken at least once every three months.’
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