During the summer, HMRC published its 2023/24 Annual Report and Accounts together with performance statistics for 2023/24 and a commentary. The 2023/24 HMRC Annual Charter Report was also published. A recurring theme in all these publications is that HMRC continues to underperform and misses key targets and in particular, call waiting times have increased significantly. So far, the new Labour Government has not provided any information on how it plans to tackle HMRC’s ongoing poor service levels. Chartered Accountants Ireland will continue to express our concerns in respect of these ongoing poor service levels and how this is impacting taxpayers, agents and businesses.
2023/24 Annual Report and Accounts
These accounts were once again qualified by the Comptroller and Auditor General due to error and fraud in tax credits in addition to qualifying his opinion on HMRC’s Resource Account for error and fraud in corporation tax research and development tax reliefs. This is the second year that the R&D SME scheme estimate has been prepared using the results of a random enquiry programme. The first modelled estimate for 2021/22 has been revised as results from the random enquiry programme now includes claims received in 2021/22. See page 21 for more detail.
The level of HMRC debt at the end of 2023/24 was £44.6 billion (£45.9 billion 2022/23), with £7.1 billion in time to pay arrangements and £37.5 billion available for collection. Approximately 900,000 taxpayers have time to pay arrangements.
The HMRC app also gets a mention in the report with almost two million new users and 69 percent of interactions with HMRC now take place online.
HMRC’s CEO in his report recognises the difficulties that have been experienced by many individual taxpayers, agents and small businesses when interacting with HMRC – in particular, when accessing helplines and says that HMRC is working hard to address these challenges with a strategy “firmly focused on how we can help more customers get their tax and customs right first time, rather than fixing problems after they happen, and on supporting more customers to self-serve using online services whenever they can.”
However, the impact of the reduction to HMRC’s budgets is clear as is the increased demand due to fiscal drag which has resulted in an additional 2.1 million individuals being brought into income tax (according to the latest figures from the Office for Budget Responsibility).
2023/24 performance statistics
These set out details of five specific targets with only one having been met for 2023/24; compliance yield. It should also be noted that the average speed of answering calls, and the waiting time of no more than 10 minutes are both no longer treated as priority metrics by HMRC; likely to be because of its digital strategy. Not surprisingly, both of these measures have deteriorated significantly as follows:
- average waiting times have reached 26 minutes, and
- ·nearly 75 percent of callers wait more than 10 minutes.
2023/24 HMRC Annual Chartered Report
Poor service levels were a recurring theme in HMRC’s 2023/24 Annual Charter Report as agents and taxpayers again vented their concerns after a year in which standards continued to fall below expectations. HMRC’s Charter sets out the standards of service that taxpayers and agents should expect from HMRC.
The report includes the results of research commissioned by HMRC and shows a fall in the percentage of agents, individuals and small businesses who positively rated their overall experience of interacting with HMRC. For agents, 37 percent gave a positive rating, down 8 percent from 2022/23.
A survey was also undertaken by the Charter Stakeholder Group which asked respondents to give a score out of 10 for HMRC’s performance against each of the charter standards, with one being the lowest and 10 the highest. 1,647 responses were received, mainly from agents.
The three standards which can arguably be said to represent the health of the tax system scored the lowest average scores as follows:
- being responsive - 2.4;
- making things easy - 2.8; and
- getting things right - 3.5.
Overall, feedback indicates that, although simple issues can be dealt with well, more complex issues are difficult to resolve. Higher scores were recorded for the remaining five charter standards.
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