We published an article in the last edition of Tax Matters Digest looking at the publication of HMRC’s Transformation Roadmap. We now look at the impact of this Roadmap for individuals.
Its publication underlines a strong commitment to transforming the UK tax system, with continued focus on digitalisation and modernisation. These changes are ultimately expected to benefit 35 million individual taxpayers, with HMRC forecasting that 90 percent of customer interactions will be digital by 2030.
HMRC revealed plans for a new online service for all PAYE taxpayers that will “make it simpler and easier to check and update their income, allowances, reliefs and expenses, and will be available via their Personal Tax Account or through the HMRC app.”
For individuals, some of the key features to look forward to include:
- An improved self-assessment registration journey (as well as a streamlining of the exit process for those who no longer need to file a tax return);
- A new expense service which will allow individuals to submit claims for tax relief on allowable expenses (and submit supporting evidence) in one place;
- Improved features which will allow individuals to report changes to their circumstances, check allowances and deductions, and ensure they are paying the correct amount of tax;
- The launch of a new High Income Child Benefit Charge (HICBC) service, which will enable parents liable for the charge to settle any amounts through PAYE - potentially negating the need to file a tax return for many;
- Pre-population of self-assessment returns with Child Benefit data;
- Improved pre-population of the self-assessment return in other areas (e.g. bank interest), to streamline tax return completion and improve the accuracy of PAYE codes;
- Modernising payments, for example by enabling more customers to receive tax refunds direct to their bank account;
- Moving to ‘digital first’ communications (with post being retained only for critical correspondence and the digitally-excluded);
- Improving agent functionality, such as allowing an agent to provide updates on matters that impact their client’s tax code online;
- Enhancing the Income Record Viewer to allow agents more visibility of existing information that HMRC hold on their clients’ affairs; and
- Introducing digitised status services and progress tracking, with plans including a new SMS (text message) alert service
These are positive changes demonstrating a continued commitment to developing the digital infrastructure into something that is fit for the modern era.
However, care will be required to ensure that the focus on digitisation doesn’t compromise customer service particularly when, according to a 2024 report by the Public Accounts Committee, HMRC customer service levels are “at an all-time low”. In particular, careful planning is required to ensure the needs of the digitally excluded are met, and that society’s most vulnerable taxpayers are still able to access the support they need.
If the ambitions set out in this road map are met, then there is huge value to be gained from the initiative by taxpayers, agents and HMRC alike. And who knows, perhaps in the not-so-distant future, the new digital services available will mean that for many, tax really doesn’t need to be taxing.