Behind the headlines: MFA for account agents, skills gap and making tax digital

We hear from some of the AAT community to unpick some of the headlines that are affecting the accounting and finance industry this month.

Multi-factor authentication (MFA) for agent accounts

Multi-factor authentication (MFA) is becoming a standard requirement for agent accounts across tax and accounting platforms. Instead of relying on a password alone, MFA adds an extra verification step, such as a code from a mobile device, to help protect sensitive client data.

For accountants and bookkeepers, this shift is reshaping how they access systems and manage workflows. While it strengthens security in response to rising cyber threats, it also brings practical challenges, from adapting day-to-day processes to supporting clients and staff through the change. So how are some of our members coping?

Andy Sullivan FMAAT said: “We’re well prepared – MFA is already standard across most of the platforms we use so adding it to HMRC agent services isn’t a big shift for us. The reality is that any modern practice should already be operating with MFA across its tech stack.

“If this feels like a significant disruption, that probably says more about the practice’s existing security posture than it does about the policy itself.

“The day-to-day impact will be minor. An extra ten seconds per login is not going to meaningfully affect productivity.”

Rachael Chadwick-Harris FMAAT says that her company is prepared for the change but questions its timing.

She said: “The profession is currently dealing with significant regulatory and technological change, and many practices are experiencing change fatigue. The practical challenge will be managing access across multiple team members and ensuring authentication processes do not create bottlenecks when dealing with urgent client matters. While these issues can be overcome, there will undoubtedly be some disruption during the transition period.”

Craig Dyer MAAT added: “I think the disruption will be minimal, and it won’t be too long until it’s the new normal. Everyone is so used to now to having the technology within their daily lives anyway, and adding extra security in a data-sensitive industry like accountancy is a good thing.”

3 key takeaways…

• Security is now baseline: MFA is seen as a necessary standard, with many practices already using it across systems, suggesting adoption should be expected, not optional.
• Limited operational impact: Most professionals expect minimal disruption to productivity, with only small time costs per login.
• Short-term challenges remain: Practices may face temporary disruption, particularly around managing team access and avoiding bottlenecks during busy or urgent work.

Making Tax Digital for Income Tax Self-Assessment (MTD ITSA):

Making Tax Digital for Income Tax Self Assessment (MTD ITSA) is a major change to how self-employed individuals and landlords report their income to HMRC.

This shift is reshaping how practitioners support clients, manage data and deliver services. While it promises greater accuracy and efficiency, it also brings challenges, from adopting new systems to helping clients adjust to more frequent reporting requirements.

Craig says that the largest impact will be with partners who are not particularly tech-savvy.

He said: “Helping individuals understand the process, and how to use bookkeeping software presents challenges, especially when some of our partners have never known anything other than a folder with paperwork in it. We have arranged meetings with partners to help them feel comfortable.

“They certainly feel it is another burden that doesn’t really help them. From our perspective it is a method of touching base with annual clients more regularly to ensure they are on top of things.”

Rachael thinks that some may be overlooking the workload. She said: “Many clients do not appreciate that MTD effectively moves them from one annual submission to five interactions with HMRC each year when quarterly updates and finalisation requirements are considered.

“This inevitably increases the workload for both accountants and clients. While firms can adapt their processes, clients often struggle to understand why fees need to increase when the underlying requirement has fundamentally changed.

“There are also practical challenges around digital record-keeping, software adoption, and the readiness of smaller businesses and landlords who have historically maintained minimal accounting records.”

3 key takeaways…

• Significant shift in reporting: MTD moves clients from annual submissions to multiple updates each year, increasing workload and frequency of engagement.
• Client adaptation is a key challenge: Less tech-savvy clients and those used to paper-based processes may struggle with digital tools and new requirements.
• Opportunity and pressure for firms: While it enables more regular client contact, it also raises challenges around fees, expectations, and software adoption.

Skills gaps in accountancy

As technology, regulation and client expectations evolve, demand is rising for those more human skills across the accounting sector. AAT’s skills gap report found that four in five employers face barriers to upskilling, with businesses calling for urgent reform to build the finance workforce of the future.

For employers and practitioners, these gaps are reshaping recruitment, training and career development. Individuals are also under pressure to continually adapt to stay relevant in a rapidly changing profession.

Andy says that skills gaps are the single biggest constraint on growth for small and mid-sized practices and that his business has felt it directly.

He said: “Finding qualified accountants who are technically competent, digitally fluent, and commercially aware is extremely difficult. You can usually find two of the three, but rarely all three in one candidate, and for us the largest factor is accountants who are commercially confident and truly understand businesses, as that is where our expertise leans in.

“The profession produces plenty of technically qualified accountants who can prepare a set of accounts, but far fewer who can sit in front of a business owner and explain what those accounts mean for their next decision. That blend of technical skill and commercial judgement is in very short supply.”

So what more needs to be done to help address the gap? Craig says that employers need to invest in ongoing development rather than treating the qualification as the finish line.

He added: “We build training into our culture, but many practices don’t – they hire qualified people and expect them to stay current on their own time. That’s how you end up with a workforce that’s technically qualified but practically outdated within five years.”

3 key takeaways…

• Shortage of well-rounded talent: Employers struggle to find candidates who combine technical expertise, digital skills, and commercial awareness.
• Barrier to growth: Skills gaps are limiting the ability of firms, especially smaller practices, to expand and meet demand.
• Need for continuous development: Ongoing training is essential, as relying on initial qualifications alone leads to outdated skills in a fast-changing profession.

Harry Rogers is AAT Comment’s news writer.