Engagement Letter updates

03 March 2026 – The Joint Professional Bodies Engagement Letters Working Party have published updated engagement letter guidance. The table below summarises the main changes made in the update

Document Summary of the change
Status of the Engagement Letters, Application of Engagement Letters and Guidance notes to the Appendices Broken links have been updated and where necessary, updates have been made to reflect legislative change. The documents have been edited for clarity and to ensure the wording reflects modern practices. 
Appendix Aa: Covering Letter to Appendix B13: Specialist or ad-hoc tax advisory services 

The documents have been edited for clarity and to ensure the wording reflects modern practices. 

Where relevant, wording has been updated to make clear the client’s responsibility to check that returns are ‘correct and complete’ and based on worldwide income. All references to ‘tax credits’ have been removed due to the abolition of tax credits on 5 April 2025. The in-year CGT return due dates have been updated to reference the 60 day deadline. Within the VAT registration paragraphs, the two VAT registration situations have been outlined for clarity, and all references to the VAT Mini One Stop Shop (MOSS) scheme have been removed due to the scheme’s abolition. Further examples of ad hoc and advisory services have been added.
Appendix Aa: Covering Letter A further example fee schedule has been added. This is an example fee schedule for use by members charging monthly fees. 
Appendix B2: Personal tax-sole traders and property income, renamed Appendix B2a: Personal tax – sole traders and property income At paragraph 2, reference to the default cash basis threshold has been removed due to its abolition.
Appendix B2b: Personal tax – sole traders and property income: Making Tax Digital for Income Tax The schedule has now been included in the main guidance document
Appendix B4b: Common Reporting Standard (CRS) and Foreign Account Tax Compliance Act (FATCA) At paragraph 2, 5 and 12 references to ‘EU DAC’ have been removed because this is no longer applicable in the UK, and reference to ‘UK/US IGA’ has been replaced with ‘FATCA’ for consistency. 
Appendix B5: Partnerships A new paragraph (paragraph 3) has been added to make it clear that accounts will be prepared on the default cash basis unless otherwise agreed. 
Appendix B6: Limited Liability Partnerships A new paragraph (paragraph 11) has been added to cover meeting the LLP’s obligations regarding salaried members. 
Appendix B8: Payroll Services Paragraph 7, which previously referred to submitting a national insurance number verification request, has been removed. A new paragraph (paragraph 16) has been added to make it clear that clients are responsible for complying with the national minimum wage legislation. 
Appendix B10a – Making Tax Digital for VAT returns, renamed Appendix B10 – VAT returns References to ‘MTD for VAT’ have been replaced with ‘VAT’. At paragraph 1, the circumstances surrounding clients’ initial registration has been added, and the numbering has been updated to ensure all paragraphs are consecutively numbered. Paragraph 3 has been updated to remove reference to requiring confirmation from clients that the data provided is correct and complete to ensure consistency amongst the schedules. At paragraph 22, the wording regarding the Capital Goods Scheme has been updated to reflect the future changes that were announced in 2025. 
Appendix B10b: VAT returns The schedule has been removed because all VAT returns are now submitted under MTD for VAT. 
Appendix B12: Tax credit and universal credit claims The schedule has been removed due to the abolition of tax credits on 5 April 2025.
Appendix B13: Specialist or ad-hoc tax advisory services, renamed Appendix B12: Specialist or ad-hoc tax advisory services  
Appendix B14: Verification and registration of overseas entities on the UK register, renamed Appendix B13: Verification and registration of overseas entities on the UK register The schedule has been included in the main guidance document
Appendix C: Standard Terms and Conditions of Business A new paragraph (paragraph 2) has been added to make it clear that AI-enabled software may be used in providing services, and paragraph 19 also refers to machine-based systems. 

03 March 2026 - The Joint Professional Bodies Engagement Letters Working Party have published amendments to the MTD for income tax schedule, namely:

 

  1. Paragraphs 13 and 34 have been updated to remove reference to requiring confirmation from clients that the data provided is correct and complete. The change ensures consistency amongst the proforma schedules and aims to avoid issues should members not request confirmation.
  2. At paragraph 23, further examples of ad-hoc services have been added to reflect changes made to other proforma schedules.
  3. At paragraph 43, the VAT registration statutory time limits have been updated for consistency amongst the other proforma schedules.   

 

25 November 2025 – The Joint Professional Bodies Engagement Letters Working Party have published amendments to the MTD for income tax schedule, namely: 

  1. The term ‘year-end tax returns’ used in paragraphs 16, 36, 37, 38 and 39, has been replaced with the term ‘year-end tax return’.
  2. At paragraph 3, reference to the default cash basis threshold of £150,000 has been removed due to the removal of the default cash basis threshold.
  3. A new paragraph (paragraph 35) has been added to make the responsibilities regarding retention of records clearer. The new paragraph states that clients have a legal responsibility to retain their documents and records, and they should maintain access where the accounting records are accessed via a third party.
  4. Updated numbering to ensure all paragraphs are consecutively numbered.

 

 

Page last reviewed 5 May 2026