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Businesses losing trust in HMRC as service standards decline

UK businesses are losing trust in HMRC as service levels drop, with inefficiencies impacting tax collection. Calls for urgent reform follow a record survey of over 10,000 businesses.

HMRC have increased the interest rates payable by taxpayers on late payments, to 7.75% - up from 7.5%, the highest interest charge on late payments since ca. 2001.
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For the first time, a majority of over 10,000 respondents, surveyed by HMRC’s Administrative Burdens Advisory Board (ABAB), rated their experience as “poor.”

Accountants and business advisers warn that trust in HMRC is eroding, with inefficiencies hindering the tax collection process. Caroline Miskin, a senior technical manager at the Institute of Chartered Accountants in England and Wales (ICAEW), emphasised: “This simply can’t be allowed to continue.”

The most significant rise in dissatisfaction stems from long wait times for phone support, followed by frustration with webchat and helpline advice quality. While HMRC has made it easier to find answers on the .gov website, many businesses are struggling with more complex processes, such as post-Brexit import and export forms.

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Dame Teresa Graham, chair of ABAB, noted that many businesses now see increased bureaucracy as part of the cost of doing business in the UK. She also stressed that the Treasury and HMRC are responding to the findings, prioritising the improvement of helpline services and developing more user-friendly online resources.

Graham urged the government to tackle the legislative burden of taxation, cautioning against simply adding new taxes in the upcoming budget. HMRC, she added, faces challenges due to outdated IT systems and insufficient resources, preventing the rollout of needed digital improvements.

The survey revealed that 84% of respondents were businesses, with the remainder being tax agents. Both groups expressed growing frustration with HMRC’s declining service standards.

Jamie Young
About the author

Jamie Young

Jamie Young is Senior Reporter at Business Matters, covering SME finance, employment law and Westminster policy since 2016. He has reported on every Budget and Autumn Statement since 2018, helped make sense of the 'covid era' and the bounce-back loan scheme from launch through the fraud investigations, and broke the magazine's coverage of the 2024 late-payment reforms. He joined Business Matters straight from completing his BA in Administration from Exeter University and is NCTJ-qualified. Reach him at jyoung@cbmeg.co.uk

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