Tax News: HMRC helps to make mortgage applications easier

Since the new mortgage affordability guidelines were introduced in early 2014, many lenders have insisted on seeing a customer’s annual tax calculation (SA302) as evidence of their earnings. Until now, it was not possible to obtain a copy of the SA302 from HMRC’s online system. This led to the mortgage applicant, or their accountant, having to contact HMRC to request a paper copy of the SA302 to be sent to them in the post.

Changes to HMRC’s online self assessment accounts will now make it easier for individuals or their accountants to obtain proof of income for mortgage or loan applications.

HMRC has been working with the Council of Mortgage Lenders to improve the annual tax calculation and SA302 in its online system so that lenders can consider accepting them as evidence of taxable income for loan or mortgage purposes.

The new process is still embedding.  Some lenders will accept copies of the online documents while others will ask for original paper copies.  For now, it’s probably best to check with the lender what they will accept to avoid any unnecessary delay or confusion.

What does this mean?

This is a very welcome change that will help to speed up the application process for loans and mortgages and reduce administrative time for clients, accountants and HMRC itself.

To print a client’s SA302 to support a mortgage application, follow these instructions:

1.Log in to your Agent online account.

2.Choose the relevant client from the authorised client list.

3.Follow the link ‘tax return options’.

4.Choose the year from the drop down menu and click the ‘Go’ button.

5.Select the ‘view return’ button.

6.Follow the link ‘view calculation’ from the left hand navigation menu.

7.Follow the link ‘view and print your calculation’ at the bottom of the page.

8.Follow the link ‘print your full calculation’.