HMRC launches new service in tax shake-up as Government announces 50 new measures

HMRChas unveiled a major overhaul to the UK tax and customs system today, July 21, set to impact 35 million people on PAYE. The fresh digital system boasts over 50 new measures and aims to streamline processes whilst also cutting costs by £50million through reducing postal correspondence.

Employees using Pay As You Earn will gain access to adigital servicedesigned to make their tax affairs "simpler and easier", according to the revenue authority. It will be accessible through your personal tax account or via the HMRCapp.

The updated service will enable PAYE taxpayers to modify the following entirely online:

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• Income
• Allowances
• Reliefs
• Expenses

A further enhancement to the system is scheduled for later this year to "modernise behavioural penalties". The tax authority highlighted its intention to prevent those who fulfil their duties from being penalised by those who fail to comply.

This represents just one of more than 50 fresh measures HMRC intends to roll out over the coming years to become a "digital first organisation" through their Transformation Roadmap. Additional measures encompass a Digital Disclosure Service enabling customers to rectify errors and digitalising the Inheritance Tax system.

It encompasses shifting customer reminders and notifications online, delivering an estimated £50million in savings from postal costs. The authority also intends to integrate more AI into their operations.

Specifically, the plan is to utilise AI to aid customers in navigating HMRC services more efficiently and ensure all guidance and content from the authority is current. This will also assist in identifying fraudulent documents during compliance checks.

With all these measures implemented, it is anticipated that by 2030, at least 90% of HMRC's customer interactions will be digital. James Murray MP, Exchequer Secretary to the Treasury, stated: "We are going further and faster to make HMRC fit for the 21st century, including delivering a simpler and easier system for all PAYE workers.

"By 2030, taxpayers can expect a modern and innovative HMRC with cutting-edge AI, industry-leading customer service practices, and a laser focus on delivering taxpayer value for money by ensuring everyone pays their fair share."

JP Marks, HMRC's Chief Executive and First Permanent Secretary, commented: "The Government's ambition is for a simpler tax and customs system and this roadmap sets out how HMRC will deliver a first-class experience that feels different to their customers.

"By 2030, UK citizens will experience a tax administration system that is more automated, more focused on self-service, and better set up to get things right first time so they can fulfil their tax obligations."

Currently, work is in progress on other measures in the Transformation Roadmap. Such as extending the rollout of the SMS confirmation service to Self Assessment appeals, complaint cases and some PAYE services.

A reward scheme is also being established to incentivise informants to expose serious non-compliance in large corporations, wealthy individuals, offshore and avoidance schemes. The new scheme will offer informants compensation tied to a percentage of any tax collected.