Corporate report

HMRC Charter annual report 2023 to 2024

Published 30 July 2024

Any reference to government refers to the government in place during the reporting period.

Message from the Chief Executive and Permanent Secretary, Sir Jim Harra KCB

HMRC has a clear and vital purpose – to collect the money that pays for the UK’s public services and give people financial support. Our Charter sits at the heart of what we do, setting out the standards of service and behaviours that customers should always expect from us.

We are fully committed to our Charter because the experience our customers have is central to our vision of being a trusted, modern tax and customs department. This report, published by HMRC’s Commissioners and provided to us by HMRC’s Customer Experience Committee, sets out our progress in meeting the Charter standards during 2023 to 2024. I’m grateful for the continued support of the Customer Experience Committee in helping us move towards our vision.

This year we faced serious challenges in delivering our customer services because of financial pressures and the need to manage a growing number of customers with complex tax affairs. This meant customers who needed to speak to us sometimes struggled to get the help they needed.

To learn more about how we could better target our customer service adviser support where it is most needed, we launched trials during 2023 to 2024 of an online-first approach for customers who had queries about their Self Assessment. We saw plenty of positive results - for example, 11.5 million tax returns were filed by 31 January 2024, including 1.75 million during the three-month trial closure of the Self Assessment helpline in summer 2023, which is more than in the same period in each of the previous three years. We also saw more customers successfully using online services than in the previous year.

Recognising that our stakeholders and customers were concerned about the pace of change, we didn’t go ahead with the changes to helplines we had planned in March 2024 and our helplines will continue to operate as before.

HMRC is 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 quicker, easier online services to deal with their tax and customs affairs whenever they can. While we want more customers to self-serve, we’re committed to ensuring customers who need extra help – including those with complex queries or who struggle to use online services, and the particularly vulnerable – receive the support they need.

We continued to make good progress on expanding and improving our online services on the GOV.UK website and in the HMRC App. During 2023 to 2024 we added new functionality to the HMRC App, so customers can now use it to view their PAYE tax code, pay their Self Assessment liabilities or claim Child Benefit - making it quicker and easier for customers to meet their obligations or claim and receive the money they’re entitled to. We’ve also expanded our use of online digital assistants, to help customers quickly find the information they need at a time that is convenient to them.

The vast majority of our customers pay their tax in full and on time, without needing us to intervene to support them or correct things. Many customers don’t need to do anything – their tax is calculated and deducted by an intermediary, such as their employer. For customers who do need to take action to keep their tax affairs in order, we want to enable them to self-serve online wherever possible, improve their experience in line with our Charter standards and meet their needs as efficiently as possible. This will help us to target our advisers more effectively towards customers who need extra help.

I welcome the Customer Experience Committee’s continued support and oversight as we continue to embed the Charter in all we do, improve service levels on our phone lines and continue to expand and enhance our online services and processes to create a better experience for customers.

Sir Jim Harra KCB
First Permanent Secretary and Chief Executive 

Foreword by Chair of the Customer Experience Committee, Jen Tippin 

I’m delighted to be leading HMRC’s Customer Experience Committee, whose work is central to HMRC’s commitment to improve customer experience and vision to become a trusted, modern tax and customs department.

Since joining the Committee in January 2023, and taking on the role of Chair in November 2023, I’ve observed HMRC’s clear commitment to improve customer experience and embed the Charter into everything it does. During 2023 to 2024 the Committee continued to advise and challenge HMRC as it delivered improvements to its online services, communications and guidance to create a customer focussed culture.

My reflection of the feedback and examples included in this report is that HMRC is making good progress in some important areas - with much of this work ongoing. However, HMRC has clearly not got everything right. Helpline performance was well below the service standards expected and many customers have been both disappointed and frustrated with their experience. The Customer Experience Committee absolutely recognises that this situation must not continue and significant improvements have to be made - quickly - so that customers can get the support and reassurance they need. I also empathise with the deep frustrations of many HMRC colleagues who have been unable to help customers in the way they would like.

To manage the ongoing impact of increasing contact demand and learn more about how it could better target customer service adviser support where it was most needed, HMRC trialled an online-first approach for three of its helpline services, including the seasonal closure of the Self Assessment helpline. In March 2024 HMRC announced plans to expand the seasonal closure of some helplines. While I understand the resourcing pressures behind these difficult decisions, HMRC’s subsequent announcement to cancel these plans demonstrates the importance of listening to customers and stakeholders and building confidence and trust.

As a vital public service, HMRC’s work touches the lives of almost everyone in the country. HMRC cannot achieve its vision to be a trusted, modern tax and customs department in isolation and is part of a much wider ecosystem of intermediaries, agents and software providers who perform essential functions on behalf of many customers. Feedback from stakeholders tells us that HMRC needs to do more to simplify guidance, increase customer awareness of what is possible online and give reassurance to customers who self-serve online that they are getting things right.

These are both exciting and challenging times for HMRC as it continues work to modernise, simplify and improve services. I would like to thank my fellow committee members for their hard work and enthusiasm in championing HMRC’s customers and providing both insight and impetus to listen more to customer feedback.

I look forward to leading the Committee as it continues to challenge, advise and support HMRC and Board to improve the customer experience for UK taxpayers.

Jen Tippin
HMRC Non-Executive Director

1. Introduction

Why the HMRC Charter matters

HMRC is your tax service – collecting the money that pays for the UK’s public services and giving financial support to people. HMRC’s vision is to be a trusted, modern tax and customs department.

The HMRC Charter sets out the service standards and behaviours that customers should expect when they interact with HMRC. It explains how HMRC aims to get things right, make things easy for customers and be fair, responsive and aware of their personal situations. The Charter also recognises that customers may want someone else to represent them and provides reassurance that HMRC will always keep their data secure.

HMRC’s activities touch the lives of virtually everyone in the UK, including more than 5 million businesses and over 34 million individuals. The Charter provides a consistent basis for the experience of all customers when dealing with HMRC. This doesn’t mean that everyone gets exactly the same experience, because different customers have different needs and different levels of complexity in their tax affairs – but it does mean providing a service that supports each customer in the most effective and appropriate way.

Because of the way the tax system is designed, the vast majority of customers pay what they owe through their employers, without needing to contact HMRC at all. For those customers who do need to interact with the tax system, the majority can do so quickly and easily by self-serving online through GOV.UK or the HMRC App. HMRC’s approach has been to expand the use of online services and promoting the benefits of using these in the first instance, so that customer service advisers can prioritise helping those customers who need the most support – but HMRC will always be there to support taxpayers who need more help, for example if they are vulnerable or digitally excluded, through helplines and the extra support service.

Working to meet Charter standards helps HMRC to remain focused on improving the customer experience, building public trust and making further progress towards its vision.

Assessing HMRC’s performance against the Charter in 2023 to 2024

This report is provided by HMRC’s Customer Experience Committee, which is made up of members of the executive and non-executive directors of HMRC, the Adjudicator, and independent advisers recruited for their expertise in improving customer experience.

The assessment of HMRC’s performance against the Charter in this report includes feedback from:

• the Customer Experience Committee, which is responsible for overseeing HMRC’s overall performance against the Charter standards
• the Adjudicator, who has provided an overall independent assessment of HMRC’s performance in section 4
• the Charter Stakeholder Group, who has provided both an overall assessment of HMRC’s performance in section 4 and commentary on HMRC’s performance against each Charter Standard in appendix 3

Each year HMRC commissions independent customer surveys for 5 customer groups: individuals, small businesses, agents, mid-sized businesses and large businesses. The results of these surveys give important insights into how it feels to interact with HMRC and current perceptions of the tax administration system. Further details of these survey results are published at HMRC Charter performance indicators.

2. Customer Experience Committee summary of HMRC’s performance and progress in embedding the Charter during 2023 to 2024

The Customer Experience Committee recognises the 2023 to 2024 financial year was challenging for HMRC. During the year HMRC continued to deliver improvements to its online services while managing the ongoing impact of financial pressures and a growing number of customers with complex tax affairs. This meant that HMRC’s helpline performance was well below expected service standards. The committee deeply empathises with the challenges and frustrations this caused for customers and agents and recognises that the telephony phone service must quickly improve.

In March 2024, HMRC announced the intention to introduce seasonal closure of some helplines in order to direct more customers to online services. This followed trials of an online-first approach for many helpline customers earlier in 2023 to 2024. While these trials saw some positive results, and the committee understands the resourcing challenges behind the seasonal closure decision, it endorses HMRC’s subsequent announcement to cancel these plans.

As a public service, it is essential that HMRC listens to customer and stakeholder feedback at every stage of the design and delivery of services and uses this insight to create better services and to understand customers’ confidence to use them. That is why the committee welcomed HMRC’s announcement that it was halting the planned telephone helpline closure, in order to engage further with stakeholders who had voiced concerns, and especially to do more to ensure customers were better prepared for the adoption of online services.

During 2023 to 2024 the committee supported HMRC with the continued expansion and improvement of its online services via GOV.UK and in the HMRC App. HMRC made good progress with this, for example during 2023 to 2024 more than 1.5 million customers used HMRC’s online services to view their National Insurance Number, with over one million viewing or saving their confirmation letter and nearly half a million saving their National Insurance number to their Apple or Google wallet. The committee was pleased that customer satisfaction with online services continued to grow.. The committee was also delighted to see feedback from the Charter Stakeholder Group which suggests that customers are satisfied with how HMRC keeps their data secure.

However, the committee noted feedback from the Charter Stakeholder Group that some online services don’t meet the needs of all customers and agents, particularly those with more complex tax affairs and that customers and agents using HMRC’s helplines are often seeking reassurance that they’ve got things right. Insight from a survey into customer preferences for engaging with HMRC suggests that whilst 86% of customers are open to engaging with HMRC digitally in the future, awareness of digital channels and associated support functions could be improved ^{[footnote 1]}. The committee is pleased with HMRC’s investment in further technology and tools to improve its understanding of customer experience of the journey at each stage of their interaction with HMRC.

Results from HMRC’s annual customer surveys for individuals, small businesses and agents showed lower positive scores compared to last year. While these results are disappointing, the committee recognises that HMRC’s ability to resolve queries and issues by phone and post, including the time taken to reach a resolution, significantly influenced these ratings.

The committee also noted feedback from individual customers that information can still be difficult to find, and there is low awareness and understanding of what customers can and can’t do online. During 2023 to 2024 HMRC reviewed and improved over 10,000 pages of guidance and encouraged more customers to self-serve using online services via GOV.UK and the HMRC App. While this is good progress, the committee agrees with HMRC that there is much more to do to simplify communications, improve signposting and increase customer awareness of online services.

Since the Charter was refreshed in November 2020, HMRC has encouraged colleagues to “Live the Charter” by supporting them to develop the skills needed to deliver the Charter standards. The committee was encouraged by comments from the Charter Stakeholder Group that HMRC’s work to raise awareness of the Compliance Professional Standards has “helped provide some consistency and fairness to the treatment of taxpayers and agents”, and from the Adjudicator that “embedding and application of the Charter has improved”.

It is also reassuring that when customers get through to colleagues, their feedback is that they are helpful and informative. The committee also noted that colleague awareness of the Charter is at 85% and that over 55% of colleagues have completed core learning to deliver the Charter. Whilst this is good progress, HMRC has more to do to fully embed the Charter across its entire operation.

In conclusion, the committee appreciates that 2023 to 2024 was a challenging year. Lessons have been learned that will help to improve customer experience across all channels for customers in 2024 to 2025. The committee will continue to guide and constructively challenge HMRC to listen to and act on customer, colleague and stakeholder feedback to ensure a significantly better experience for its customers.

3. Overview of HMRC’s performance against the Charter

Customer experience and online services

When considering customer experience, it is important to note that millions of HMRC’s customers pay their tax without needing to interact with HMRC because of the way the tax system is designed.

For those customers who do need to interact with HMRC, use of online services has continued to steadily increase. For example, HMRC’s online personal tax account, business tax account, digital engagement platform and the HMRC App were accessed 250.4 million times in 2023 to 2024, compared with 61.6 million times in 2016 to 2017.

HMRC’s overall customer experience

Each year HMRC commissions independent customer surveys for five customer groups; individuals, small businesses, agents, mid-sized businesses and large businesses. These surveys give important insights into customer experience and perceptions of the tax administration system. Further details of these survey results are in Appendix 4.

The proportions of customers who positively rated their overall experience of interacting with HMRC in 2023 were:

• 58% of individuals (65% in 2022)
• 70% of small businesses (74% in 2022)
• 53% of mid-sized businesses (52% in 2022)
• 81% of large businesses (81% in 2022)
• 37% of agents (45% in 2022)

Customer experience of HMRC’s contact channels

HMRC invites customers using telephony and online contact channels to give feedback on their experience. With similar response rates across channels, customer satisfaction is much higher for online channels – ending the year at 83%, compared to satisfaction with telephone services at 42.9%. The majority of HMRC’s customers don’t need one-to-one help to manage their affairs either because their tax affairs are intermediated, or because they are willing and able to use online self-serve channels. Some examples to illustrate the level of customer usage of HMRC’s online services during 2023 to 2024 include:

• 17.6 million customers logged into their online personal tax account, an increase of 9% compared to the previous year. More than 3.4 million surveys were completed, with over 81% of respondents indicating they were satisfied with the service
• 9.5 million users logged into their online business tax account, which was around the same as the previous year. 770,000 surveys were completed, with over 75% of respondents indicating they were satisfied with the service
• use of the HMRC App continued to grow, in 2023 to 2024, the App received 88.5 million logins by 3.8 million unique users, a growth rate of over 64% when compared with the previous year. The HMRC App consistently receives an average customer rating of 4.8 out of 5 stars

Overview of work to improve customer experience in line with the HMRC Charter standards

During 2023 to 2024 HMRC continued to focus on improving customer experience by delivering against the Charter standards, supported by the priorities of the Customer Experience Committee noted in last year’s report, which were as follows:

• to continue to advise HMRC on its digital transformation; and guide and constructively challenge HMRC as it advances changes to the way it approaches customer service and compliance
• to focus on the design and delivery of a single customer account, ensuring it improves the end-to-end customer experience of HMRC and is exploited to its maximum benefit across HMRC
• to ensure HMRC’s digital transformation is underpinned by a customer experience dashboard that provides multi-channel customer insight
• improved customer communications and guidance to ensure customers choose to use HMRC’s digital services
• to embed the Charter standards into all of HMRC’s decision making.
• to support the HMRC Board in other deep dives related to customer experience improvement throughout the year

The next section sets out the important work HMRC did during 2023 to 2024 to improve customer experience and how that work links to the Charter standards.

Delivering quicker, easier to use online services 

Charter standards:

• making things easy -being responsive

The majority of customers who need to engage with HMRC to pay their tax can self-serve through GOV.UK or the HMRC App. Customer satisfaction scores for these online services are consistently above 80% - indicating the ease and speed with which they meet customer needs – in line with Charter standards.

Although HMRC is making progress towards delivering quicker, easier to use online services, it recognises feedback from the Charter Stakeholder Group highlighting that not all transactions can be completed online and that some customers are frustrated with the inconsistency of HMRC’s online provision. HMRC also acknowledges that customers often contact them to seek reassurance that they have got things right, when using online services.

During 2023 to 2024 HMRC made good progress on improving its online services. Activities included:

• introducing online claims for Child Benefit customers, via GOV.UK or the HMRC App, to make the process much quicker and easier for customers, for example customers can now receive their payments in as little as 3 working days – down from an average of 19 days
• adding new functionality to the HMRC App, which continued to grow in popularity - for example, customers can now use it to view their PAYE tax code, pay their Self Assessment liabilities or claim Child Benefit
• improving the system that holds customer PAYE records, by making it simpler to correct tax codes. HMRC can now spot when a customer’s tax code may be incorrect and automatically issue a new one if it holds the information to do so, without the customer needing to contact HMRC
• expanding the use of online digital assistants, to help customers quickly find the information they need, or link them to an adviser through webchat. These digital assistants are now available across 79 areas of tax

HMRC will continue to listen to the concerns and needs of its customers and stakeholders and make sure that any changes are implemented at a speed and in ways that customers are comfortable with.

Improving customer communications and guidance to encourage customers to use online services

Charter standards:

• getting things right
• making things easy
• being responsive
• being aware of your personal situation

Helping customers to meet their tax responsibilities is a central principle of the HMRC Charter. This means giving customers clear, accurate information, and making communications and guidance easy to read so that they take the right action first time.

Although HMRC is making good progress on improving guidance, feedback from customers indicates that some information can still be difficult to find, and that levels of awareness and understanding of what customers can and can’t do online are low.

During 2023 to 2024, with Customer Experience Committee support, HMRC improved its communications and guidance to make things easier to understand and encourage customers to use online services. Activities included:

• continuing to improve the clarity, language and tone of HMRC’s direct communication products, to make them easier to understand - this included improving over 700 complex letters, emails, SMS messages and factsheets
• continuing to improve guidance on GOV.UK – reviewing over 10,000 pages and identifying opportunities for improvement, such as better signposting to specific guidance for small businesses on topics like: setting up as a sole trader, claiming reliefs, registering for the right taxes and understanding budgeting for tax bills
• creating more interactive and decision-based guidance, including information to support businesses registering for Income Tax Self Assessment and new forms for customers reporting VAT errors. This interactive approach helps to ensure that customers receive information based on their personal circumstances
• using communication campaigns and activities to help customers understand their tax and customs obligations and raise awareness of eligibility for tax reliefs and credits. Examples include: helping to achieve 90.4% of expected Self Assessment returns filed on time, with 97.1% filed online; and supporting delivery of 2.4 million Cost of Living payments worth a total of £800 million to tax credits customers

Building a customer-focused culture across HMRC

Charter standards: All

Since publishing the Charter in November 2020, HMRC has encouraged and supported colleagues to develop the skills needed to deliver the Charter standards.

Feedback from the Charter Stakeholder Group indicates that HMRC’s work to raise awareness of the Compliance Professional Standards has “helped provide some consistency and fairness to the treatment of taxpayers and agents”; while feedback from the Adjudicator acknowledges that “embedding and application of the Charter has improved”, but the “benefits of this may not yet be as apparent as HMRC would like”.

During 2023 to 2024 HMRC continued to embed the Charter into its standards and processes and support colleagues to build their capability to deliver the Charter standards. Activities included:

• continuing to strengthen HMRC’s focus on improving customer experience, by creating new customer-focused standards to support the design and delivery of new and improved services
• developing a business case for a multi-channel digital dashboard, giving HMRC better customer journey data to inform future design decisions
• launching a new HMRC Charter learning product (completed by over 24,000 colleagues) and continuing to embed the Compliance Professional Standards into the handling of compliance case work and decision making
• mobilising the first stage of the Service Excellence Programme in Customer Services Group, this aims to embed the Charter into the culture of operational teams by building manager capability to deliver coaching and facilitate effective team meetings and problem-solving activities
• curating and sharing relevant customer insight and knowledge to help HMRC colleagues to operate in a more customer focused way

Results from a survey of HMRC colleagues during 2023 to 2024 indicate that 85% know about the HMRC Charter and 39% believe it influences their work, both of which represent a small increase on the previous year.

Helping customers with tax compliance

Charter standards:

• getting things right
• making things easy
• treating you fairly
• being aware of your personal situation

HMRC promotes good compliance, making sure as many customers as possible get their tax right from the outset, so there is no need for HMRC to step in and fix problems after they have filed their tax return. This includes improving systems and processes, raising awareness of compliance work and supporting colleagues to build capability and improve standards. Activities during 2023 to 2024 included:

• expanding the use of prompts on both HMRC and third-party systems, to alert customers if they enter data that differs from what is expected, for example during 2023 to 2024 HMRC built a ‘nudge’ message to help customers using a commercial software product to select the right classification for taxable grants received by businesses. This simple change prompted 3,400 businesses to correct their tax returns at the point of submission
• improving how HMRC identifies and supports customers who need extra help during compliance activities and making sure they get the support they need. This includes ensuring customers have access to appropriate debt advice and support at the earliest opportunity, by improving the handover and referral process between compliance and debt management work areas
• developing, with support from external stakeholders, four new YouTube videos aimed at demystifying HMRC’s dispute resolution process, which is used when a customer disagrees with the outcome of a compliance check
• continuing to use a range of interventions to embed the Compliance Professional Standards into the handling of compliance case work and decision making - including significant engagement with compliance managers and their teams, as well as ensuring the standards are introduced early in the learning journey to all trainees in the Central Training Unit
• publishing the Compliance Professional Standards on GOV.UK in July 2023, to clearly set out HMRC’s commitment to embed the Charter into compliance work through clear principles and objectives
• continuing to improve the use of one-to-many letters, used for communicating with multiple customers on compliance issues, by sharing draft letters with external stakeholders for feedback on the messages, timing and potential impact on customers

Providing support to customers who need extra help

Charter standards:

• being aware of your personal situation
• treating you fairly

HMRC has established processes for providing extra support to customers who may experience difficulties understanding what they need to do when dealing with their tax affairs, due to a lack of confidence or capability when accessing HMRC systems, or because of mental health issues or some other form of disability. HMRC continuously reviews these processes to ensure they meet the needs of customers.

Feedback from the Charter Stakeholder Group suggests that HMRC’s performance against this Charter standard varies. There were positive comments about HMRC’s approach of allowing extensions on disclosures and Time to Pay arrangements, to support customers experiencing difficulties. However, the feedback also noted that HMRC does not always effectively identify when someone is vulnerable – and that customers having difficulty contacting HMRC and being able to speak to an adviser, creates more problems and results in customers feeling they aren’t listened to.

During 2023 to 2024 HMRC continued to strengthen the provision available for customers who need extra help, by improving processes and supporting colleagues to develop new skills to support customers. Activities included:

• launching new internal policies, including a revised Reasonable Adjustment Policy to ensure advisers are aware of how to meet the needs of disabled customers
• developing adult safeguarding procedures and guidance to help colleagues identify customers at risk of abuse and the action they need to take
• delivering guidance to 30,000 colleagues to help identify and support victims of domestic or economic abuse
• continuing to work in partnership with Samaritans to build colleague capability in identifying customers in vulnerable circumstances and signposting, where appropriate, to a dedicated Samaritans helpline
• supporting customers who need extra help with literacy and numeracy to deal with their tax affairs

Resolving complaints

Charter standards:

• getting things right
• treating you fairly

HMRC aims to get services right for customers first time. When this doesn’t happen and customers experience difficulties, HMRC has a straightforward and accessible complaints process.

The way HMRC handles and responds to complaints is fundamental to the delivery of the Charter. HMRC greatly values its engagement with the Adjudicator and their feedback helps HMRC to deliver its strategic objectives and meet Charter standards. The Adjudicator provides an impartial, and independent service that investigates complaints which have gone through HMRC’s internal complaints process, but not reached a satisfactory resolution. HMRC uses this feedback to encourage learning from complaints across the department.

During 2023 to 2024 HMRC received 92,206 new complaints, a small increase compared to the previous year, with delays in operational services again being the main reason. The larger number of complaints, combined with a backlog of older complaints, meant that complaints took on average 36 days to resolve – longer than HMRC would like. HMRC is working hard to improve the handling of complaints through its complaints strategy and by embedding the UK Central Government Complaint Standards.

HMRC is grateful for the support of the Adjudicator’s Office, in identifying improvement activity to help it address the root causes behind complaints and keep improving the customer experience.

Strengthening HMRC’s relationship with intermediaries

Charter standards:

• getting things right
• making things easy
• recognising that someone can represent you

HMRC’s Charter standards include recognising that customers may want someone else to deal with HMRC on their behalf, such as an accountant, friend or relative. Around 70% of small businesses use an agent, and tax agents represent around 12 million HMRC customers in total.

Feedback received in response to the Individuals, Small Businesses and Agents Customer Survey suggests that agents had a less positive experience of HMRC overall, compared to previous years. There was a decrease in the number of positive ratings for telephone helplines, and this was exacerbated by the fact that fewer agents interacted with HMRC using online only channels (compared to other customer groups) – reflecting the more complex and frequent interactions that agents are having with HMRC. Half of the agents who completed the survey reported that HMRC had made an error.

During 2023 to 2024 HMRC improved its services for agents by:

• expanding the range of online services enabling agents to see and do what their clients require for example using the ‘Income Record Viewer’ which gives agents easier access to their clients’ PAYE information
• improving agent authorisation for VAT and Self Assessment, to enable agents to act for their clients across all contact channels using a single authorisation
• starting work to explore how to allow multiple agent functionality to be developed in the future

In 2023 to 2024, HMRC also continued with initiatives to improve standards in the tax advice market, including:

• working with professional bodies to align expectations on standards for agents who support customers to meet their tax obligations
• taking action to uphold agent standards, including making Public Interest Disclosures to professional bodies about misconduct and suspending access to online agent services for breaches of professional standards
• publishing a consultation on strengthening the regulatory framework in the tax advice market and improving registration to raise standards and prevent substandard agents from being able to act for customers. A summary of responses will be published in due course
• responding to exploitative repayment agent practices, including:
  • removing the use of assignments for Income Tax purposes
  • requiring repayment agents submitting claims for Income Tax repayments to register with HMRC, and provide their Agent Reference Number when they submit a claim
  • requiring agents to submit evidence of the original PPI payment to their client alongside their claim
  • taking joint enforcement action with the Advertising Standards Authority to deal with misleading advertisements

Keeping customers’ data secure

Charter standards:

• getting things right
• keeping your data secure

As guardians of one of the biggest sets of customer and colleague personal data in government, HMRC has a responsibility to ensure it is protected with industry standard levels of security, and that its use of data is transparent, proportionate and complies with data protection laws. In addition to the Charter standard, HMRC has specific obligations of confidentiality under the Commissioners for Revenue and Customs Act, as well as responsibilities under data protection legislation.

Feedback from the Charter Stakeholder Group suggests that customers and agents generally consider that HMRC is meeting this Charter standard and are satisfied with how HMRC keeps data secure. However, some comments indicated a lack of trust in HMRC, and some concerning breaches were referred to in the survey feedback.

During 2023 to 2024 HMRC continued to make improvements to its IT estate, to improve data protection and security capability. This included migrating some systems to more mature cloud hosting, modernising older data held on microfilm and microfiche and implementing an information governance framework to support better management of all data types.

4. Overall independent assessments

Independent Adjudicator - Mike McMahon

This is my first contribution to the Charter Annual Report as Adjudicator since I was appointed in October 2023.

It has been another challenging year for HMRC. Complaint volumes have been high, meaning HMRC has been focused on returning to service level standards. As has been widely reported, and we see this too through our casework, HMRC has struggled to provide a timely service for customers who contact them by phone.

HMRC closed the Self Assessment Helpline in June 2023 for a trial period of three months. Our July and November 2023 insight raised the potential impact of the pilot on the level of customer service provided by HMRC. We asked how the department would review the pilot and HMRC has been transparent with me about how it has learned lessons.

HMRC planned to close more phone lines from April 2024 but decided to pause the plan soon after it was announced. Overall, I support HMRC’s strategic ambition to move customers to online services. It is currently near impossible for HMRC in many cases to meet the standards making things easy and being responsive if a customer interacts with them over the phone.

Online service satisfaction rates are generally much better and support the ambition of the Charter. Less traffic through phone lines means, in theory at least, that those people who need to speak to someone, be it because of complexity, vulnerability or because the customer is digitally excluded, will not have to wait longer than is necessary. However, the customer must be at the heart of decisions around the timing and approach. The digital offer needs to be fit for purpose and easy to use.

I suspect significant operational decisions made in anticipation of the closures will now have had to be unpicked at pace. My concern is that without either an injection of resource or a new plan, issues with the phone lines are likely to remain in the short to medium term, creating a potentially worse service for customers. Trust and reassurance remain key catalysts for customers to pick up the telephone. The more HMRC can do to become a trusted organisation, the greater chance it will have to curb phone demand and improve service levels. Trust is synonymous with the Charter.

HMRC has fewer people to do more and the impact of that will inevitably be felt by their customers. I do see HMRC trying to square the circle through innovation and some risk taking. Examples include a root and branch interrogation of its complaint process with tangible activity flowing from that. HMRC is piloting the empowerment of frontline staff in its Customer Services Group to resolve problems when they arise, rather than handing them over to a complaint team – something that inevitably builds in delay and cost. HMRC has been explicit with me that it is not prepared to accept the cycle of high complaint volumes, recovery, steady state and back again, which we have seen in the last few years. There are signs that HMRC is returning to a balanced state with a significant reduction in complaints waiting to be resolved.

We have continued to utilise our reporting approach through the lens of the Charter and have issued quarterly insight reports to HMRC. Our recommendations are regularly discussed at HMRC’s Customer Strategy and Insight Board and are driving service improvements. I have seen this year a willingness by HMRC to step back on individual complaints and not prioritise process over the person. The challenge is that this often only happens when the case is escalated by me or my office to senior HMRC officers. I suspect that when applying rigid process to huge functions, discretion can get lost. The Charter should be the blueprint for that activity. I would like to see HMRC – and there are signs this is happening – make the Charter a significant, if not the main, consideration in all HMRC’s decision-making.

In summary, it has been a difficult year for HMRC, but I can report that both the embedding and application of the Charter has improved, albeit the benefits of that may not be as apparent as HMRC would like. In some areas, and as discussed above, the service HMRC provide is not acceptable. I believe though that activities HMRC are undertaking now, channelled through the Charter, will improve the service HMRC provides in the future. HMRC will rightly be judged on the success of its activities and that success is unlikely to happen overnight. The challenge is to get to that point as quickly as possible and I will continue to hold HMRC to account on that.

Mike McMahon, The Adjudicator

Charter Stakeholder Group

See Appendix 3 for representative members.

We have considered HMRC’s performance in 2023 to 2024 against its Charter. To provide evidence-based feedback, we undertook a survey of agents and taxpayers over a four-week period in February and March 2024. We received 1,647 responses in total, including 1,330 from agents, and 268 from individual and business taxpayers.

The survey repeated the previous year’s questions, asking respondents to give a score out of 10 for HMRC’s performance against each of the Charter standards, with one being the lowest possible score and 10 being the highest. We also asked, for each standard, what HMRC does well, and what they could improve. A high level of engagement was displayed, with respondents taking an average of eight minutes and thirteen seconds to complete the survey and providing 12,524 freeform comments. We have shared the full results of the survey with HMRC.

As with last year’s report, complaints about HMRC’s service levels dominate the feedback and heavily influence the scores. ‘Being responsive’ scored the lowest of the Charter standards, with an average score of just 2.4 out of 10. ‘Making things easy’ and ‘getting things right’ scored slightly higher, but still poorly, at 2.8 and 3.5 respectively. Consistent with last year, these three standards are by far the lowest scoring, which is disappointing as between them they represent the ‘health’ of the tax system.

Typical feedback indicated that, while straight forward issues are often dealt with well, more complex issues are difficult to resolve: “Most agents contact the revenue because they require assistance with something beyond the basic understanding that is generally covered online - this is something that is becoming increasingly more difficult to obtain” is a representative comment. And the challenges of shifting taxpayers and agents from phones to online interaction was summed up with: “If I was able to do it via the website I would not be wasting my life on hold”.

The remaining five Charter standards typically address the context in which HMRC operate, and these scores are higher, particularly around mutual respect and data security, the latter scoring the highest average score in the survey of 6.8. Interestingly, taxpayers scored HMRC lower than agents in each of these five categories, and that is something HMRC may wish to reflect on.

Our survey also addressed awareness of the Charter, and HMRC’s accountability against it. 78% of agents were aware of the HMRC Charter, compared to 68% of taxpayers. This represents a slight reduction in agents’ awareness, but a significant increase (of 12%) from last year in taxpayers’ awareness. While relatively modest numbers of taxpayers completed the survey, it does suggest that HMRC’s work to promote its Charter is paying off.

88% of respondents do not think that HMRC is held sufficiently accountable for its performance against the Charter, with only 3% considering they are (the remainder unsure).

Appendix 1: HMRC Charter

Working with you to get tax right 

HMRC is here to collect the tax that pays for the UK’s public services. 

We’ll help you meet your tax responsibilities and make sure you get any benefits, tax credits, refunds or other support you can claim. However, we will take firm action against the small minority who bend or break the law. 

Our standards 

Getting things right 

We’ll give you accurate, consistent and clear information. This will help you meet your obligations and understand your rights and what you can claim. When we ask for information, we rely on you to give us full, accurate and timely answers. If you disagree with us, we’ll tell you about options available to you and work with you to reach an appropriate outcome quickly and simply.

Making things easy 

We’ll provide services that are designed around what you need to do, and are accessible, easy and quick to use, minimising the cost to you. 

Being responsive 

When you get in touch with us, we’ll make sure that the people you deal with have the right level of expertise. We’ll answer your questions and resolve things first time, or as quickly as we can. We’ll also explain what happens next and when you can expect a response from us. If we make a mistake, we’ll put it right as soon as possible. If you’re not satisfied with the service you’ve received, we’ll explain how you can make a complaint. 

Treating you fairly 

We’ll work within the law to make sure everyone pays the right amount of tax and gets their benefits and other entitlements. We’ll assume you’re telling the truth, unless we’ve good reason to think you’re not.  

Being aware of your personal situation 

We’ll listen to your worries and answer any questions clearly and concisely. We’ll be mindful of your wider personal situation, and will give you extra support if you need it. 

Recognising that someone can represent you 

We’ll respect your wish to have someone else deal with us on your behalf, such as an accountant, friend or a relative. We’ll only deal with them if you have authorised them to represent you. To protect you, HMRC works with professional bodies to set the standard expected of professional agents who support you to meet your tax obligations. We can refuse to work with professional agents who fail to adhere to this standard. 

Keeping your data secure  

We’ll protect information we hold about you and treat it as private and confidential. We’ll always use that information fairly and lawfully.  

Mutual respect 

We take any threats, intimidation or harassment very seriously and will take appropriate action against any behaviour of this type. We’ll always treat you in line with our values of respect, professionalism and integrity. Our employees are people too and we expect you to treat them in the same way. 

Appendix 2: Customer Experience Committee

The Customer Experience Committee assists the Commissioners of HMRC in their statutory obligation to report annually on the extent to which HMRC has demonstrated the standards of behaviour and values included in the HMRC Charter and complies with the legal obligation to periodically review the content.

The purpose of the committee is to support and challenge ExCom on customer experience-related issues and to help the department deliver on its strategic objectives.

The committee does this by:

• challenging and supporting HMRC to tackle high level risks to the department
• examining planned changes to ensure that the impact on customers has been sufficiently considered
• providing advice on how relevant policies, strategies and practices can be improved
• identifying priority areas in the end-to-end customer experience where improvements are necessary

The committee publishes a report each year that sets out HMRC’s performance against the HMRC Charter, and includes progress and priorities for further improvement.

Membership

Membership includes representatives from HMRC’s executive, Non-Executive Directors (including the Chair) and Independent Advisers who have relevant expertise that contributes to its work.

Membership details and biographies are published at HMRC Customer Experience Committee.

Appendix 3: Charter Stakeholder Group

Charter Stakeholder Group members

• Institute of Chartered Accountants in England and Wales
• Low Incomes Tax Reform Group
• Association of Chartered Certified Accountants
• Chartered Institute of Payroll Professionals
• Admin Burdens Advisory Board
• Institute of Chartered Accountants of Scotland
• The Association of Taxation Technicians
• The Chartered Institute of Taxation
• Institute of Financial Accountants

Charter Stakeholder Group Comments against each Charter standard

Getting things right

HMRC received a score of 3.5 out of 10 (3.4 last year), with agents scoring HMRC marginally higher (3.6) than taxpayers (3.3). It was noticeable that the score that received the most votes was 1 out of 10, given by almost a quarter of the respondents.

Some felt that HMRC were performing relatively well. This tended to be in relation to routine processes, for example producing and sending out simple calculations or providing options when a taxpayer disagrees with a decision. It was noted that guidance for those with simple tax affairs is reasonable, and staff are better able to assist with less complex situations. Agents acknowledged that HMRC’s technical manuals were often useful.

However, the majority view was that HMRC were not doing anything well under this standard. Accuracy, whether of guidance, information or calculations produced by HMRC, was the issue raised most often. Agents are often in a position to identify inaccuracies, but unrepresented taxpayers may assume HMRC’s output is correct. This continued decline is particularly concerning as it is often combined with a lack of timeliness, and difficulties in obtaining corrections.

Both agents and taxpayers noted many areas for improvement, such as improving consistency in responses from HMRC staff on helplines and improving processing times which could prevent some of the inaccuracies in calculations which currently arise.

Overall, although some respondents felt that they had received accurate information, calculations or guidance from HMRC, the majority viewed HMRC as having a lot of work to do to improve their performance against this standard.

Making things easy

The HMRC Charter commitment to Making things easy was the second worst performing area with an average score of 2.8 out of 10 (2.7 last year), with agents scoring HMRC marginally lower (2.7) than taxpayers (3.0). 38% of respondents scored HMRC 1 out of 10.

Again, respondents highlighted that HMRC performs well for taxpayers with simple affairs, but were frustrated with the inconsistency of online offerings and angered by HMRC’s slow and poor-quality responses. The general feeling was summed up by one respondent: “Nothing is quick and easy when dealing with HMRC”.

It was clear that agents and taxpayers would like consistency, certainty and reliability from HMRC. Suggestions for improvements included simple solutions such as acknowledgement of when HMRC are in receipt of communication, consistent timelines for responses from HMRC, and that when a promise is made it is kept. It was also suggested HMRC could help itself by putting “more trust in agents to self-serve” and where processes can be undertaken online, provide agents with the relevant functionality. Respondents also were keen that the HMRC staff were upskilled and provided with appropriate training.

The common theme throughout the comments was frustration with the cost of HMRC inefficiencies to taxpayers, agents and HMRC itself. These included “Cost for firms and clients are increasing …. due to the inefficiency of HMRC” and “There is currently no easy way to contact HMRC …provide us with an effective line of communication”.

Being responsive

This was again the lowest scoring Charter standard, with an average of 2.4 out of 10 (2.3 last year), with agents scoring HMRC marginally lower (2.3) than taxpayers (2.6). 49% of respondents scored HMRC just 1 out of 10. Out of the 785 freeform comments regarding the question “In what parts of this standard does HMRC perform well?”, over one-third said “none”.

Agents continued to voice concerns with the time taken to get a response from HMRC, regardless of communication method used. Some agents referenced positive experiences, if able to get through to a call handler, however the inconsistency of expertise demonstrated remains an issue with one agent stating, “It really depends on who answers the phone as to the standard of expertise and if a resolution of the query is reached” and another commenting “depends on the department one is dealing with”.

Fewer comments were received from personal and business taxpayers but those that did also referred to the response times, although some complemented HMRC such as “Once we get through to personnel at HMRC they are helpful and informative”.

The introduction of the webchat facility received a cautiously warm welcome, such as “The recent webchat facility for agents is a huge improvement though still inefficient and not easily available - agents can’t go to the service directly and have to [be] referred from the regular webchat service first”.

Treating you fairly

Here HMRC scored an average of 5.0 out of 10 (4.8 last year), with agents scoring HMRC slightly higher (5.4) than taxpayers (4.0).

During the year we welcomed the work undertaken by the Customer Compliance Group (CCG) to make open and transparent its Compliance Professional Standards. The Standards have set out how those working in CCG should apply the HMRC Charter and Civil Service values in their compliance activity, and this has helped provide some consistency and fairness to the treatment of taxpayers and agents. We would welcome similar openness and transparency within the Customer Service Group (CSG).

Taxpayers and agents noted that when they were able to speak to compliance officers, the officers regularly appeared to want to treat them equally, fairly and in accordance with their guidance and manuals. Interactions are seen as being polite and on the whole helpful, but access to officers is still a barrier. In complex cases the quality of tax knowledge was considered poor and the application across taxpayer groups inconsistent.

Although the scoring suggests that HMRC’s performance is average, the reality is that the responses were polarised. Many respondents felt fairly treated by HMRC (usually when dealing with simple requests and straightforward cases) and scored highly. Others indicated the opposite experience of feeling that HMRC had pre-judged culpability, lacked objectivity and demonstrated indifference. The loan charge and Research and Development cases featured prominently in responses as examples where taxpayers and agents considered that HMRC’s approach was both erratic and unfair.

Being aware of your personal situation

Respondents scored HMRC an average of 4.1 out of 10 (4.1 last year), with agents scoring higher (4.3) than taxpayers (3.3). 43% of taxpayers responding scored HMRC 1 out of 10. These results are almost identical to last year’s.

Respondents gave a varied view on what HMRC does well regarding this Charter standard, with many indicating that they do not demonstrate this very well. Concerns were raised around the continuity of care provided if agents or inspectors changed, meaning personal issues are not picked up by subsequent staff involved.

Positive comments were provided around HMRC allowing extensions on disclosures, and assistance with death or illness of individuals or agents. Time to pay arrangements were commented on multiple times and seem to be taken extremely positively.

While efforts may be made to support vulnerable taxpayers, some respondents indicated that not enough effort was made to identify when someone is vulnerable. Many comments referred to the difficulties in contacting HMRC; not being able to speak to a representative can impact how heard they feel, and is continuing to have impacts on the mental health of individuals.

While HMRC is gearing towards self-service methods of engagement, there is concern that this removes the personal element of dealing with tax affairs. Complaints of under-resourced phone lines remain rife and show no signs of easing. With individual situations sometimes not being resolved, causing mental health concerns, better phone line assistance is being called for.

Recognising that someone can represent you

HMRC scored an average of 5.7 out of 10 (5.1 last year), with agents scoring HMRC slightly higher (5.8) than taxpayers (5.1).

Consistent with last year, many respondents felt that HMRC did recognise a role for agents. There were some favourable comments from agents about HMRC checking to ensure they were speaking to someone properly authorised. The Agent Dedicated Line was also mentioned as being helpful, although some long delays were noted.

However, HMRC’s approach was seen as inconsistent, with agents not always copied on correspondence, and taxpayers complaining that HMRC failed to deal with their agent when asked to do so, but continued to communicate directly.

Various problems with the authorisation process were noted, including time taken to receive codes (which expired before arriving), clients struggling with the complex online process (and options for the digitally challenged did not always work well), too many additional authorisations required for services (for example, CGT 60 day reporting), HMRC’s system not recognising multiple agents acting for different areas, issues with deceased clients, and HMRC failing to process 64-8s or not properly recording that an agent was acting.

Some agents noted difficulties with setting up accounts and changing details, such as addresses. Again, some taxpayers experienced problems appointing friends or family members to deal with HMRC on their behalf.

HMRC was also still failing to deliver on its important commitment that agents should be able to see and do what their clients can see and do. There were numerous complaints about agents’ inability to access all client information, or to perform certain tasks.

Keeping your data secure 

Taxpayers and agents generally consider that HMRC is meeting this Charter standard, scoring an average of 6.8 out of 10 (6.5 last year). Again, agents scored HMRC slightly higher (7.0) than taxpayers themselves (5.8). The majority of respondents were satisfied with how HMRC keeps data secure. However, other comments indicated a lack of trust in HMRC, and some very concerning breaches were reported. Factors behind lack of trust included the number of tax related scams and HMRC’s contract with Fujitsu.

There were reports of HMRC communications being misdirected, sometimes because of an address being changed incorrectly or being co-enveloped with a letter for a different taxpayer, suggesting that HMRC’s checks on outgoing post are not sufficient. In some cases (Research and Development enquiry letters were mentioned) a problem seems to have arisen because information was cut and pasted from a letter for another taxpayer.

There were reports of taxpayers (mainly employers) appearing on agent online accounts even though they are unknown to the agent and no authority had been given.

Clarity on several areas would be helpful, including the security of webchat (some expressed concern that data might be intercepted), whether HMRC staff working from home always have a private space to work in as family members have been heard in the background, and the release of information (including agent details) to debt collection agencies. Some taxpayers who have experienced breaches have found it difficult to get HMRC staff to take the matter seriously.

Mutual respect

Here, HMRC scored an average of 5.6 (5.4 last year), and again agents scored HMRC higher (5.8) than taxpayers themselves (4.7).

Most respondents reported that they find contact centre and other HMRC staff to be generally polite, helpful, and respectful, but with exceptions where HMRC staff behaviour falls well below the expected standard. Some expressed sympathy with HMRC contact centre staff who are sometimes powerless to help because of lack of training and inadequate systems.

There is an increasing number of reports of cases where it seems that HMRC advisers have terminated a call because an issue is complex, time consuming or difficult. Also concerning is an increasing number of reports of poor quality or inaccurate advice and a lack of recognition that agents with many years of experience in tax will generally know when advice is incorrect.

The tone of written communications is sometimes seen as aggressive. The handling of Research and Development enquires by some case workers in Individuals and Small Business Compliance (ISBC) was criticised by several respondents as lacking respect and professionalism.

Long telephone waiting times, the frequency of calls being cut off, and delays to dealing with written correspondence are seen as disrespectful. Criticism on service performance was mostly aimed at HMRC as an organisation rather than at individuals.

Appendix 4: HMRC Charter performance indicators

Performance against the HMRC Charter is monitored by specific service standards, customer surveys and other data, linked to wider HMRC performance measures. These are set out against each Charter standard and published with the HMRC Charter.

---

1. Contact method preferences and digital appetite research - executive summary - GOV.UK (www.gov.uk) ↩