Client approval before filing returns

Before filing a return for a client, the adviser should send the client the final version, point out the judgement areas and the client’s responsibility for it, and obtain the client’s approval in a form that can be produced later. The professional bodies’ PCRT guidance requires evidence of approval, electronic or on paper, and HMRC’s guidance for Making Tax Digital for Income Tax tells agents to get the client’s written confirmation before submitting the year end return.

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Who is legally responsible for a return the agent files?

The client. Section 8(2) of the Taxes Management Act 1970 requires every self assessment return to include a declaration by the person making it that it is, to the best of their knowledge, correct and complete. Paragraph 3(3) of Schedule 18 to the Finance Act 1998 requires the same declaration on a company tax return. PCRT Helpsheet A puts it plainly: the taxpayer has primary responsibility for submitting correct and complete filings, while the adviser is responsible to the client for the accuracy of the filing based on the information provided.

The penalty rules follow the same line. Under paragraph 18 of Schedule 24 to the Finance Act 2007, a taxpayer is liable for a careless inaccuracy in a document given to HMRC on their behalf, unless they satisfy HMRC that they took reasonable care to avoid it. HMRC’s Compliance Handbook at CH84540 says a person cannot simply appoint an agent and deny responsibility, that HMRC would expect evidence of what passed between the person and the agent, and that the benchmark includes checking the adviser’s work to the best of the person’s ability. A recorded approval is therefore evidence for the client as well as protection for the firm. See HMRC penalties for errors in returns.

What does PCRT require before a return is submitted?

Professional Conduct in Relation to Taxation applies to members of the main tax and accountancy bodies. Its Helpsheet A covers every kind of filing, including any online submission of data used to calculate tax, for all taxes, NIC and duties. Under the heading “Approval of tax filings” it says the member should:

advise the client to review the filing before it is submitted;
draw the client’s attention to the responsibility they take on in approving it as correct and complete;
draw attention to any judgement areas or positions taken, so the client understands them and their implications before approving;
obtain evidence of the client’s approval in electronic or non electronic form.

Helpsheet A also says the member’s files should contain enough evidence to support positions taken, including timely notes of discussions with the client and the client’s final decision. More on the framework is in PCRT explained.

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What counts as good evidence of approval?

PCRT does not prescribe a format, so the test is whether the firm could later show which version the client approved, when, and that they understood what they were approving. Common methods include:

a signed copy of the return or computation, on paper or through an electronic signature platform with an audit trail;
approval through a client portal that logs the user, the document version and the time;
an email reply from the client approving an attached final version, ideally quoting the tax due or repayable so it ties to one specific draft.

Good practice is to send a short covering note with the draft listing the main figures, any estimates or provisional figures, any items treated in a way HMRC might question, and any extra disclosure in the white space, and asking the client to confirm that the return is complete. If the figures change after approval, the client should approve the revised version. Approval for a company should come from a director with authority to approve on the board’s behalf. The approval record should be kept for at least as long as HMRC can still enquire or raise an assessment; see how far back HMRC can go.

Is approving company accounts different?

Yes. Section 414 of the Companies Act 2006 requires annual accounts to be approved by the board and signed on the balance sheet by a director on the board’s behalf, with a statement above the signature if the small companies regime or micro entity provisions are used. Section 414(4) makes it an offence for a director to approve accounts they know, or are reckless as to whether, do not comply with the Act.

ICAEW’s helpsheet on electronic signatures notes that approval is not the same as signing: an email saying the client has approved the financial statements only shows they are happy with them, and they still need to sign in some way. Electronic signatures are presumed valid for accounts unless the company’s constitution specifies otherwise. The practical sequence is board approval, a director’s signature on the balance sheet, then filing at Companies House and, where relevant, submission with the company tax return. See electronic signatures on company documents.

How does Making Tax Digital for Income Tax change the process?

HMRC’s guidance on submitting a return through Making Tax Digital for Income Tax sets out the steps for an agent. Only the client’s main agent can submit the return. The agent should confirm in the software that they are ready to submit, check the tax calculation, share a copy of the information being submitted with the client, ask the client to check it and provide written confirmation that it is correct and complete, and then submit by declaring that the information and calculation are correct and complete to the best of their knowledge.

The PCRT bodies’ guidance on MTD for income tax adds that a quarterly update is not a tax return. Client approval is not expected for each quarterly update or each time the software calls for a calculation, provided the client has confirmed that the information and records provided are complete and accurate. Approval is expected before the submission containing the final declaration. See Making Tax Digital for Income Tax.

What if the client cannot or will not review the return?

Helpsheet A deals with this as an exception. Where a filing is not reviewed by the client before submission, the engagement terms should make clear that filings are completed on the information the client has provided, and that the client is no less responsible for errors than if they had approved and signed the return personally. Where the adviser approves a return on the client’s behalf, for example as attorney, trustee, executor or director, they should consider their legal authority to do so, how the client will review and take responsibility for the contents, and the legal implications for the firm and the individual signing.

If a client approves a return the adviser knows to be wrong, the issue is no longer approval but a refusal to correct an error. See when a client will not correct a tax error.

How might this work in practice?

Illustration only. A firm prepares a sole trader’s return showing £6,200 payable. On 20 January it uploads the return and computation to its portal with a note flagging that the use of home costs are estimated and that a van purchase has been treated as qualifying for the annual investment allowance. The client clicks “approve” on 22 January; the portal logs the user, version number and time. On 23 January the bookkeeper finds a missed sales invoice, the liability rises to £6,450, and the firm reissues the return. The client approves the new version the same day, and only then is it filed. Both approvals and the covering notes go on the file.

What mistakes do firms make?

Treating “go ahead and file” in a phone call as approval without any written record.
Filing a later version than the one the client approved.
Sending figures for approval without flagging estimates or contentious treatments.
Taking an email approval of company accounts as if it were the director’s signature.
Using the engagement letter exception routinely instead of obtaining approval.
Not keeping approval evidence long enough to answer an HMRC enquiry or a later complaint.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 8 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.