The wide-reaching nature of HMRC’s tax adviser register means it has unintended consequences for thousands of businesses beyond the original 4,000 tax agents expected to fall under the regime.

In the first move to defer registration for certain groups, HMRC has decided to exclude financial services businesses initially with a short deferral until March 2027.

HMRC is reviewing the definition of ‘financial services business’ under the legislation to ensure the regime works effectively and does not hamper the sector unnecessarily, accepting that it needs to make the rules ‘proportionate and workable’.

‘HMRC has heard clearly from the financial services sector and their representatives that the legislation as drafted risks bringing some activities into scope as an unintended consequence, and that certain requirements may present operational difficulties,’ HMRC admitted in a notice confirming the delay.