Transparency data

Enterprise Tax Management Platform (ETMP) Regeneration Programme — summary business case

Published 16 July 2026

1. Strategic case

1.1. Introduction

HM Revenue and Customs (HMRC) Enterprise Tax Management Platform (ETMP) is the core platform for tax accounting and payments, processing over £800 billion each year across more than 50 tax regimes and used by over 40,000 internal users.

ETMP is currently based on SAP ECC6.0, which was released in 2005. SAP will end mainstream support at the end of 2027, with extended maintenance available to 2030 for customers that commit to migrating to SAP S/4HANA.

Although ETMP remains within SAP support arrangements, continued reliance on older technology would increase operational and resilience risks over time. Migration to S/4HANA is therefore required to preserve service continuity and safeguard HMRC’s ability to collect, manage and account for tax revenue.

1.2. Strategic alignment

HMRC Strategic Objectives (SO)	ETMP Alignment
SO1: Close the Tax Gap	Regeneration of ETMP will support HMRC’s ability to ensure that everyone pays the tax they owe.
SO2: Improve day-to-day performance and the overall customer experience	Regeneration of ETMP will enhance operational efficiency and support a more effective customer experience.
SO3: Reform and modernisation of the tax and customs administration	The programme will modernise ETMP processes and support a more effective tax administration
SO4: Build a high-performing organisation with a skilled and engaged workforce.	The programme will support the development of capability needed to deliver a high-performing service.
SO5: Support wider government economic aims through HMRC’s work	The Programme will modernise the platform which collects over £800 billion in tax revenue and contributes to broader economic outcomes and cross government priorities.

HMRC’s IT Strategy takes a platform-led approach focused on agility, resilience and modern integration. It supports data-driven decision-making, promotes seamless integration through the Hybrid Integration Platform (HIP), and advances a cloud-based Software as a Service (SaaS) operating model to modernise and future-proof HMRC’s technology landscape.

The Programme aims to regenerate ETMP while safeguarding HMRC’s ability to collect, manage and account for tax revenue. It will also improve the user experience and create better long-term business value by reducing the cost and complexity of future change. This vision drives the following Programme objectives:

• Programme objective 1: Safeguard HMRC’s ability to collect, manage, and account for tax revenue
• Programme objective 2: Improve the experience of ETMP users

1.3. Scope of the Programme

ETMP is a critical component of the UK’s tax administration system. HMRC will migrate ETMP from SAP ECC6.0 to SAP S/4HANA. This will move the platform onto modern technology and provide a stronger foundation for improved usability, streamlined processes and future service development.

To enable this migration, HMRC will:

• procure and implement the SAP S/4HANA product suite through a managed cloud service in a UK-based hosted environment that meets HMRC’s security and data requirements
• procure a Migration Delivery Partner with the capability to design, build and manage the migration to S/4HANA
  • prepare ETMP for technical migration by reducing the size of the existing database, updating the integration environment and updating other technical components that require modernisation before migration
  • prepare the organisation for change by developing and testing new use cases for emerging technologies to fully exploit the new capabilities offered by S/4HANA.Following migration to S/4HANA, a separate run and change partner will be appointed. Procurement of this service is not within the scope of the ETMP Regeneration Programme

1.4. Dependencies

For migration to take place, the Programme will need to implement a series of critical enabling projects to pave the way. These include changes to the integration environment and reducing the data size of the current platform. Delays to these projects would impact the critical path of the programme and potentially increase costs.

1.5. Constraints

The Programme must minimise impacts on key periods of operational activity on the current platform which are critical to HMRC fulfilling its obligations to collect tax revenue.

1.6. Assumptions

‘Technical conversion’ is a proof of concept which will test and validate key assumptions driving the critical path of the Programme. It will undertake mock migration activity using a full set of data in a test environment.

There is an assumption that holding and processing HMRC data in both the SAP Private Cloud Edition and Business Technology Platform environments will meet the appropriate security standards.

2. Economic case

2.1. Shortlist of options considered

Option A.1 — Do nothing (stay on ECC6 unsupported)

This option was not considered viable due to the level of service and operational risk. HMRC would lose access to specialist knowledge that currently supports live service issues, which significantly increases risk that any future technical failures would result in an extended interruption of service for both customers and internal users.

Should a critical failure occur that results in ETMP being unavailable for any period, there would be a significant impact, including:

• a delay to HMRC payments, both incoming and outgoing
• it would not be possible to undertake administration for tax regimes that use ETMP
• HMRC would not be able to account for those payments that it does receive

Additionally, the anticipated benefits (Performance, User Experience) from migrating to S/4HANA would not be realised.

Option C.1 — Third-party extended support with no migration

Rejected, as it would not address the underlying risks of remaining on a legacy platform or deliver the strategic benefits of modernisation.

Option D.1 — Compete to replace SAP (potential non-SAP ‘greenfield’):

Shortlisted but not recommended. Market testing and subsequent engagement with potential suppliers identified through market research indicated that alternative providers could not meet HMRC’s requirements within acceptable cost and timescales.

Additionally, the indicative cost uplift and extended delivery timeline for this option were derived from a high-level assessment of the additional activity that a full platform replacement would require beyond the recommended option. This would include a competitive procurement, end-to-end solution design and build, large-scale data migration, replacement or redesign of integrations, extensive testing, business transition and phased implementation.

This option was assessed as likely to increase costs by more than £700 million and extend delivery timescales beyond 10 years.

Option B.1 — Recommended

Extend ECC6 support while migrating to S/4HANA (SaaS, sovereign cloud) through appropriate contractual arrangements; procure a Migration Delivery Partner competitively.

2.2. Appraisal method

For the ETMP Regeneration Programme, Critical Success Factors (CSFs) define the criteria against which the available delivery options have been assessed.

These CSFs were developed through engagement with senior HMRC stakeholders and reflect the fundamental requirements that any viable option must meet, given ETMP’s role as HMRC’s core tax accounting and payments platform. For options involving more fundamental platform replacement, indicative cost and timescale assumptions were derived from a high-level assessment of the additional end-to-end activity that would be required.

Consistent with HM Treasury Green Book guidance, each shortlisted option was evaluated against the following CSFs to determine the preferred option:

• CSF1: Protect the Live Service — Ensures HMRC systems and tax collection remain stable and protected during transition
• CSF2: Reduce the Risk in the Estate — Reduces technical, operational, financial, delivery and reputational risks
• CSF3: Enable New Ways of Working — Supports increased productivity, improved customer/user experience, and better compliance through modernised, optimised processes
• CSF4: Value for Money — Option must provide the best overall value for HMRC and the UK
• CSF5: Affordability — Option must be realistically deliverable within available funding
• CSF6: Flexibility — Enhances HMRC’s ability to support resilient, secure and rapidly adaptable services, especially for policy or market change

Following this assessment, Option B.1 was identified as the recommended option.

2.3. Costs and benefits of the recommended option (B.1)

Estimated programme range cost: £452.5 million (minimum), £485.9m million (mid), £536.7 million (maximum) inclusive of optimism bias.

The benefits of the programme are primarily associated with maintaining service continuity and reducing risk, alongside longer-term operational improvements. Indicative benefits associated with Option B.1 include:

Safeguarding Critical National Infrastructure is a primary benefit of the programme’s, ensuring the continuity of HMRC’s ability to collect, manage and account for tax revenue. Over £800 billion tax per year is collected through ETMP, equating too approx. £67 billion per month or £2.2 billion per day, balanced off against a maximum cost of £536 million of the full programme delivery plus run costs of the duration of the SAP contract (2035).

Improved Productivity and User Experience — migration to S/4HANA will significantly improve usability and enable streamlined processes. This is expected to deliver material productivity gains through simplified, role-based interfaces and reduced transaction effort.

Faster Delivery of Change at Lower Cost — adoption of SAP Build tools and modern platform capabilities will accelerate the delivery of new functionality, enabling policy and operational changes to be implemented more quickly and at lower cost.

Enhanced Data, Analytics and Decision-Making Capability — upgrading to modern data tooling, including SAP BW/4HANA, will improve access to real-time data and analytics, supporting better decision-making, financial reporting, and operational insight across HMRC.

The programme supports the use of modern platform capabilities, including automation and improved access to data.

Reduced Technical and Operational Risk — moving from a legacy platform to a modern, supported SaaS solution will reduce technical and operational debt and mitigate the risks associated with unsupported software and ageing infrastructure.

Secure, Compliant and Future-Proof Technology Platform — the use of SAP Sovereign Cloud provides a secure, UK-hosted environment aligned to government data residency, security standards, and regulatory requirements, strengthening HMRC’s overall risk posture.

Value for Money (VFM) — the case is driven primarily by the need to maintain continuity of a critical service. The preferred option avoids significantly higher costs and delivery risks associated with alternative options, while supporting longer term operational and efficiency benefits.

The preferred option to extend support for ECC6 beyond the end of 2027 and begin migration to S/4HANA in 2026 based on directly awarding a contract to SAP, provides greater VFM than extending support beyond 2027 and undertaking an exercise to select a new product which would involve redesigning the architecture and procuring a new platform, the cost of which is estimated to be significantly higher.

Affordability — the recommended option has been developed to be deliverable within HMRC’s available funding assumptions and provides a more affordable route than the alternative options considered.

Benefits Range — we expect the preferred option to deliver efficiency savings in the range of £173.3 million to £604 million and additional yield of up to £550 million.

3. Commercial case

3.1. Procurement strategy

The Programme will progress two linked procurements aligned to the Sourcing and Construction Playbooks. These are:

• SAP ETMP Software (RISE + BTP on UK Sovereign Cloud) Using appropriate procurement routes and contractual arrangements
• Migration Delivery Partner via a competitive government framework agreement

3.2. Commercial risk and allocation

The Programme’s commercial risk profile centres on the availability of SAP’s Sovereign Cloud product, service performance and continuity, effective exit and termination arrangements, the potential accumulation of technical debt, and the risk of programme costs exceeding the approved funding envelope.

These risks are mitigated through standard government contractual frameworks which provide clear mechanisms for service governance, including defined Service Level Agreements (SLAs), performance measures and service credit provisions.

Robust contract and supplier management will provide ongoing oversight of performance, cost control, and risk mitigation throughout the lifetime of the contract.

3.3. Social Value and sustainability commitments

As part of the proposed ETMP Regeneration contracts, SAP and the Migration Delivery Partner will be committed to a package of social value initiatives aligned to HMRC priorities and the Government Social Value Model.

4. Financial case

4.1. Funding and affordability

Approval is sought for a ceiling investment of £536.7 million whole-life cost to deliver Option B.1 through the ETMP Regeneration Programme, covering the period from 2022 to 2023 to 2035 to 2036. This reflects the upper bound of the programme’s cost range, including the application of optimism bias in line with HM Treasury Green Book guidance.

The estimated cost range for Option B.1 is £452.5 million to £536.7 million and remains sensitive to procurement outcomes, delivery sequencing and risk realisation.

The programme has been assessed as affordable within HMRC’s medium term funding assumptions, subject to prioritisation and cost controls. Expenditure will be managed through HMRC’s established financial governance arrangements, with drawdown of funding aligned to delivery milestones and subject to ongoing review at each approval gate.

4.2. Assumptions underpinning profiles and key financial risks

Go-live of the new platform in Spring/Summer 2029

Delays to achieving this date could increase costs.

Software licence cost variance

Final procurement outcomes could result in variation from current cost estimates, with potential impacts on whole life costs.

Indexation

Long term supplier pricing may be subject to inflationary pressures, which could increase costs over the life of the contract.

Migration complexity

The scale and complexity of ETMP could introduce additional unforeseen risk which extends delivery timescales and increases costs.

Capacity and capability constraints

Sustained access to specialist skills and capacity is required to deliver the programme.

5. Management Case

5.1. Delivery Plan

The ETMP Regeneration Programme will deliver the migration from ECC6.0 to S/4HANA through a phased approach covering procurement and mobilisation, build, testing, deployment and transition into live service. This delivery strategy ensures that:

• procurement of key suppliers is completed early to enable credible and collaborative mobilisation

• data preparation, integration transformation and system readiness activities are completed ahead of system conversion

• build and testing phases are sequenced to protect live service and ensure operational readiness ahead of go-live

• deployment and cutover are carefully managed within a constrained window to minimise disruption to critical tax operations

5.2. Key milestones

2025 to 2026: Procurement and mobilisation

• SAP software contract awarded — December 2025
• technical conversion commences — April 2026
• Migration Delivery Partner (MDP) contract awarded — May 2026

2026 to 2027: Onboarding and start of build

• MDP onboarding complete — August 2026
• start of build — January 2027
• start of system integration testing — June 2027

2027 to 2029: Integration, testing and readiness

• integration delivery complete — December 2027
• upgrade to S/4HANA (dress rehearsal) — November 2028
• testing complete — February 2029

2029: Deployment and go-live

• go-live — May 2029

5.3. Governance and oversight

The ETMP Regeneration Programme is governed through established HMRC investment, assurance and delivery arrangements, appropriate to its status as a critical national infrastructure. Overall accountability sits with a Senior Responsible Owner (SRO) model, with delivery led by a Programme Director in partnership with delivery partners.

Delivery is organised through defined projects, with appropriate oversight and governance technical delivery is undertaken by a Delivery Partner, operating under HMRC control and subject to formal performance, commercial and risk management arrangements.

Strategic oversight is provided through HMRC’s investment and governance committees to ensure executive visibility.

5.4. Risk management

The programme faces several risks, which are being actively managed through the Programme’s governance, control and assurance arrangements. Key risks include:

Periods of restricted change

These may be required to managed delivery risk.

Delivery risk

There is a risk that delivery complexity could lead to delays or increased costs.

Capability/capacity

Delivery of the Programme requires significant levels of specific skills and capability over a sustained period. There is a risk that market forces result in workforce turnover which negatively impacts delivery.

For migration to take place, the Programme will need to implement a series of critical enabling projects to pave the way. These include transformation of the API landscape and reducing the data size of the current platform. Delays to these projects would impact the critical path of the programme and potentially increase costs.

Business operational readiness

The programme will introduce transformational new capability to HMRC users. There is a risk that the business change required to leverage new capabilities will be running in parallel with other programmes delivering HMRC’s transformational agenda.

5.5. Evaluation plan

During delivery, progress will be evaluated through leading indicators aligned to the key performance indicators of the Programme including progress on platform data reduction, integration readiness and deployment of core S/4HANA capabilities, supported by formal assurance and gateway reviews.

Post go-live, evaluation will focus on service stability, operational performance and the Programme’s ability to support policy and business change on the new platform, with lessons learned captured to inform future major technology programmes.

Evaluation activity will be integrated into existing programme governance and assurance arrangements, avoiding duplication and ensuring findings are actively used to support delivery and investment decision-making.