HMRC Nets £126m Savings From Online Filing

The tax office has done well with its online filing roll-out but faces challenges on customer services

HM Revenue & Customs (HMRC) has saved £126 million to date by introducing online tax filing, according to estimates by the National Audit Office (NAO), which praised the HMRC’s efficient roll-out of online services in spite of budget pressure.

However, the online tax filing programme is nevertheless creating less savings than originally projected, and HMRC needs to bring in better measurements of the real benefits the online system is offering, the NAO said in a report on Friday.


“HMRC’s expansion of online filing has been a real achievement. The programme is largely complete, to time and budget, and more than 11 million customers are filing online,” said NAO head Amyas Morse in a statement.

Morse said the main problem is that the HMRC doesn’t have an accurate way of measuring the relative costs of dealing with paper and online returns or the costs and benefits of seeking greater online take-up.

“HMRC cannot demonstrate that the benefits are being maximised. Significant improvement is needed in its understanding of costs and benefits to inform future development.”

The tax office faced challenging roll-out targets and has signed up more than 11.5 million customers a year for the service, with mandatory online filing requirements helping to boost take-up, the NAO said.

The service has delivered a stable service since 2008, including during peak times, apart from an incident in July 2009, the NAO said.

On the other hand, take-up on some taxes including VAT, Corporation Tax and Self-Assessment has been below HMRC’s original forecast, partly due to the costs and usability of filing VAT and Corporation Tax online, the NAO noted.


The report also noted that customers have concerns about delays in getting access to log-in details for the Self-Assessment service during peak periods, while others had concerns about the quality of assistance available through some helpdesks.

The service’s website does not yet meet accessibility standards, the NAO said.

HMRC has introduced the system while also dealing with other major changes, including stabilising the PAYE service, introducing a real-time information system and reducing the avoidable use of telephone helpdesks.

The government has been pushing a wider programme of introducing digital services for several years and most recently launched a campaign to make services “digital by default”.

This year’s Government ICT Strategy included promises for easier access to online government services and information.

In June HMRC said it would extend its campaign against tax cheats using ‘web robots’ to trawl cyberspace. HMRC said it would utilise “web robot” software to search the internet and find targeted information about specified people and companies.

HMRC also says that by using the software it can more accurately pinpoint people who have failed to pay the right tax. But it seems that the government software will also be used to locate people who are trading without informing HMRC.