Signposts reading "complicated" pointing left, and "simple" pointing right

HMRC missing opportunity to simplify tax services, says ATT

29 June, 2023

In its latest consultation on creating a tax system fit for the 21st century, HMRC falls short on its remit to simplify the tax system, focusing instead on measures which reduce its own workload, according to The Association of Taxation Technicians (ATT).

HMRC’s consultation1 proposed measures including digitalising certain income tax processes, speeding up the flow of data that could affect how much tax employees pay under Pay As You Earn (PAYE), and revisiting who has to submit a tax return each year.

The ATT2 says that, in focusing on these areas, the consultation is unlikely to achieve real simplification for taxpayers, as well as overlooking some details which could derail plans to modernise the tax system.

Senga Prior, Chair of the ATT Technical Steering Group, said:

“Simplification was made the responsibility of HMRC and the Treasury by former Chancellor Kwasi Kwarteng, when he announced the abolition of the Office of Tax Simplification (OTS). That decision has been upheld by Jeremy Hunt, so it is disappointing to see this consultation largely fail to live up to its stated aim of ‘simplifying’ income tax.

“Instead, the drive to digital, improving PAYE data flows and making it easier for taxpayers to understand when they need to submit a return all appear to be aimed at reducing HMRC’s workload. While we applaud efficiencies, especially in the public sector, reduction in support from HMRC should not come at the cost of additional stress, delays and uncertainty for taxpayers. The recent closure of the Self-Assessment helpline3 is a worrying example of the withdrawal of such support.”

With much of the consultation focusing on digitalisation, the ATT has also urged caution, as HMRC’s  track record in introducing new digital services is far from perfect.

Senga Prior said:

“HMRC don’t seem to realise that taxpayers are often unaware of what they can do using HMRC’s online services, or even why they might need to access them. People are also understandably scared to use digital self-service facilities for tax in case they get something wrong. Even those who employ accountants and agents to look after their tax affairs may be unable to benefit from digitalisation, as HMRC’s digital offerings don’t always allow agents the necessary access.

“What’s more, given HMRC’s recent performance in customer service and response times, we question how they will cope with the additional burden of supporting taxpayers trying to get to grips with new digital ways of communicating with them, especially if the current SA helpline closure becomes a more common event.

“Rather than using digital services as a sticking plaster to cover up HMRC being under resourced, we would like to see a more fundamental review of how tax can be made simpler, continuing the work of the now-defunct OTS. We have also previously called4 for HMRC to be better resourced, so they can deliver the service taxpayers expect.”

Notes for editors:

  1. HMRC consultation: Simplifying and modernising HMRC's Income Tax services through the tax administration framework.

  2. ATT response to HMRC consultation.

  3. ATT press release: Surprise closure of HMRC helpline will add to last-minute tax return rush.

  4. ATT press release: Professional bodies unite to urge Chancellor to improve HMRC service levels.