UK tax advisers face a major shift in regulation. HMRC’s aim is understandable: taxpayers should be protected from the minority who exploit the system and damage trust in the profession. But most advisers act conscientiously and professionally, and it is vital that new powers are applied proportionately and with proper safeguards.
These changes should not be seen as an accusation against responsible advisers. They should, however, prompt firms to check that their governance, file documentation and quality controls evidence the standards they already work hard to maintain.
Mandatory tax adviser registration – more than an administrative exercise
HMRC’s Modernising and Mandating Tax Adviser Registration (MMTAR) regime is being introduced in phases. The first registration deadline is 18 August 2026 for new tax advisers and advisers interacting with HMRC who do not already have an Agent Services Account, Self Assessment account or Corporation Tax account. Failure to register may restrict an adviser’s ability to act for clients and could lead to sanctions.
Registration is more than a database exercise. It is part of HMRC’s wider move to impose minimum standards across the tax advice market. Firms should identify relevant individuals, confirm who is responsible for oversight, and ensure AML, ethics, training, review and record-keeping procedures are fit for purpose.
A new era of "sanctionable conduct"
From 1 April 2026, HMRC’s adviser misconduct regime focuses on “sanctionable conduct”. Properly targeted, these powers should help tackle bad actors whose conduct harms taxpayers, the Exchequer and the reputation of the wider profession.
However, the breadth of the regime means safeguards matter. HMRC should not use these powers to penalise advisers for advancing tenable technical positions, challenging HMRC’s interpretation, or making honest mistakes in complex areas of law. Intention remains critical: HMRC must show that the adviser intended to cause a tax loss.
HMRC's file access powers
HMRC can also require access to adviser files through a file access notice where it has reasonable grounds to suspect sanctionable conduct. This may be justified in serious cases, but it is a powerful tool and must be used sparingly and proportionately, given the sensitivity of adviser files and client confidentiality.
Good documentation is therefore essential. Clear records of instructions, assumptions, risks and technical reasoning will help responsible advisers demonstrate the care and judgement behind their advice.
Reputational damage may be the bigger risk
Financial penalties are significant, but publication may be a greater concern. HMRC can publish details of advisers receiving conduct penalties above the relevant threshold. Public naming may be appropriate for deliberate abuse, but it must be fair, accurate and reserved for cases where the statutory conditions are clearly met.
What should firms do now?
- Confirm whether and when registration is required.
- Identify responsible individuals and review governance.
- Check Anti Money Laundry, ethics, Professional Conduct in Relation to Taxation, training and quality assurance procedures.
- Improve file notes and technical sign-off for higher-risk advice.
- Plan how the firm would respond to a file access notice.
Key message
HMRC is clearly moving towards greater oversight of the tax advice profession. The profession should support action against those who deliberately exploit taxpayers or the tax system, while also insisting that compliant advisers are not deterred from giving robust, independent advice.
The key is balance: poor behaviour should be challenged firmly, but HMRC’s new powers must be exercised fairly, proportionately and with due regard to genuine professional judgement.
Conclusion
The regulatory environment for tax advisers is evolving rapidly, bringing increased scrutiny alongside new responsibilities. While these reforms are intended to strengthen standards and protect taxpayers, they also underline the importance of strong governance, thorough documentation and consistent professional judgement. Firms that take proactive steps now will be better positioned to meet their obligations, respond confidently to HMRC enquiries and continue delivering trusted advice to clients.
Now is the time to assess your readiness. Review your registration requirements, governance framework and compliance processes to ensure your firm is prepared for the changes ahead. If you would like to discuss how these developments could affect your business or your clients, please get in touch with our Tax Disputes and Investigations team.
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