Policy paper

Strategic approach to third party software

Published 26 March 2026

1. Foreword by JP Marks, Permanent Secretary, HMRC

HMRC is transforming the way it operates to deliver a trusted, modern tax and customs system, with technology and improved customer experience at its heart.

The software sector is one of our most valued and important partners in achieving this. Over the past decade, the scale of our partnership has grown dramatically: the number of third-party software providers working with HMRC has risen from around 600 to almost 3,000 — and in VAT alone, from 100 to over 1,000.

Today, almost 90% of digital tax returns are submitted through third-party software. That growth is a testament to the value that software providers bring to our customers, and to the strength of the relationship we have built together with our partners in the software sector.

This Strategic Approach sets out how we will build on these strong foundations. As HMRC continues to deliver on its Transformation Roadmap — with the ambition of making the tax system simpler, more accurate and more accessible for everyone — third-party software will be central to our vision. Making Tax Digital is a core part of our strategy - one of the most significant changes to tax administration in a generation - and its success depends on a thriving, innovative software market that helps customers meet their obligations through tools they already use in their day-to-day lives.

Our focus is on the components of software that interact with HMRC systems. We are not seeking to direct how providers build or develop their products more broadly, and we recognise that tax and customs functionality is often one part of a wider product offering. Our aim is to be a strong, consistent partner for that key integration with our systems, making it straightforward for customers to connect with HMRC and using the power of software to help more customers be tax compliant - through accurate, timely reporting and by preventing avoidable errors.

HMRC’s role in maintaining market quality means being clear about where we set direction and where we work collaboratively with the sector. We will set the outcomes and standards we expect from integrated software — on accuracy, security, reliability and customer protection — and will apply these in a transparent and proportionate way, in line with our HMRC Charter commitment to be open, fair and responsive. Within that framework, we’ll work in genuine co-creation with software providers on the design of standards, the sequencing of change, and the shaping and development of integration pathways, drawing on their expertise and insight into real-world product design and user needs.

I’m clear that this is not and cannot be a one-way relationship. The insights, expertise and real-world experience that software providers bring to the table are essential for us to get policy and design right. We have already seen the benefits of closer collaboration through the engagement that shaped this strategic approach, and we are committed to making that the norm rather than the exception.

The priorities set out in this document mark the start of a sustained programme of work. From 2026, we will establish co-development structures, with a full delivery plan to follow by Spring 2027. By 2030, our shared ambition is a tax and customs system that works seamlessly for customers, supported by software that is reliable, accurate and easy to use.

I hope this strategic approach provides a clear signal of our intentions and a firm basis for the partnership that will make it possible. If you would like to be involved in shaping standards or participating in early testing, please contact softwarestrategyandpolicy@hmrc.gov.uk

I welcome your engagement and look forward to working with you in the months and years ahead.

JP Marks
Permanent Secretary, HMRC

2. Introduction

The UK tax and customs system is undergoing rapid modernisation and reform. Guided by HMRC’s Transformation Roadmap, HMRC will be a digital first organisation focused on closing the tax gap and improving the experience of our customers. Our ambition for most interactions with HMRC to be digital by 2030 relies on customers being able to meet their obligations inside the systems they use day-to-day, including third-party software that integrates directly with HMRC systems.

Third-party software already provides substantial value to the tax system. It simplifies routine tasks for individuals, traders and small businesses, holds critical records, supports complex requirements for larger organisations and enables tax advisers, customs agents and intermediaries to manage clients efficiently.

A thriving, reliable and innovative software market is therefore an essential part of a modern tax and customs system. HMRC’s role is to help create the conditions that allow this market to undertake this role effectively and commercially sustainably by providing clarity about expectations, delivering stable and predictable change and constructive engagement.

This strategic approach builds on the existing strength of the software market to create the supportive conditions needed for continued progress and growth, including two decades of increasingly professionalised collaboration with HMRC, healthy competition between providers of different sizes and growing integration of tax and customs processes into everyday business tools.

While the market has strong foundations, HMRC recognises that not all products or practices deliver the level of reliability or protection that customers and the system require. Similarly, HMRC also recognises that there is scope to improve its own services and operations to better facilitate software interactions. Addressing these areas, is a core purpose of this strategic approach.

Figure 1: Overview of the strategic approach and how the components fit together

Figure 1 provides an overview of the strategic framework that underpins this strategic approach. It summarises the  core principles that shape collaboration with providers and the outcomes for customers, the tax system and the wider software market.

This framework establishes the foundation for the more detailed themes and priorities that follow. It describes how HMRC will strengthen its approach to engagement, oversight, innovation and technical readiness and how providers and customers contribute to an effective ecosystem.

2.1. How this strategic approach was developed

This strategic approach reflects broad engagement across the tax and customs ecosystem. HMRC worked with software providers, intermediaries, representative bodies, customer groups and internal delivery teams to test problems, shape options and set priorities.

Engagement included workshops with representative end users, targeted sessions with providers of different sizes and detailed contributions from intermediaries. Insights were also gathered from operational service data and from discussions through HMRC’s Strategic Software Forum, which helped test how proposals would work in real environments.

HMRC is grateful for the support and constructive engagement provided throughout the process. The contributions of developers, businesses and intermediaries brought practical experience that helped ensure the work remained focused on the issues that matter most to users and providers.

HMRC also recognises the collaboration of the Business Application Software Developers’ Association, the Chartered Institute of Taxation and the Confederation of British Industry. These organisations worked with HMRC to jointly design and chair a series of tailored workshops that brought together a broad cross section of the sector. Their involvement strengthened the quality and breadth of the engagement and ensured that participants’ voices could meaningfully influence the development of this strategic approach.

This process provides a clear proof point that HMRC is acting on its ambition for earlier involvement of providers in discovery and for more consistent approaches to change. The range of perspectives gathered during development has ensured that the strategic approach is grounded in practical experience across the market.

Building on the collaborative foundations established during development, HMRC will continue to apply the engagement principles set out in this approach, involving providers, intermediaries and customer groups where their expertise can inform practical and proportionate implementation.

2.2. Scope and boundaries of this strategic approach

This strategic approach sets out HMRC’s strategic approach to working with third‑party software that connects directly with HMRC systems. It explains how HMRC and the software ecosystem will work together, how expectations will be signalled and how a more consistent and reliable environment will be created for providers, customers and intermediaries.

The scope covers software products that exchange data with HMRC through recognised integration channels such as APIs and approved digital services. It applies across relevant taxes and heads of duty, including customs, income tax, VAT, corporation tax and PAYE. It does not apply to tools that do not integrate with HMRC or to wider commercial features that fall outside tax and customs administration.

This document is a strategic statement. It does not create legal rights or impose new obligations. Any specific requirements for providers will continue to be delivered through established mechanisms such as standards, guidance, contractual terms and legislation where appropriate. These mechanisms remain authoritative in setting the conditions for access and use of HMRC integration services.

HMRC retains responsibility for setting the strategic direction of the software ecosystem. That direction will be informed by engagement with providers, intermediaries and customers so that decisions are grounded in real experience and practical insight, but the responsibility for determining priorities and expectations rests with HMRC.

2.3. Shared responsibilities for an effective software ecosystem

Roles and responsibilities remain clear. Individual taxpayers are responsible for their own tax liabilities. Providers are responsible for meeting HMRC’s published standards and ensuring that their products support accurate and reliable outcomes. HMRC’s role is to steward a fair, reliable and trusted market by setting clear expectations, maintaining consistent integration pathways and applying requirements in a transparent and proportionate way.

The following commitments describe how HMRC, software providers and customers contribute to an effective software ecosystem. As more customer interactions with the tax and customs system take place through third‑party products, clear expectations and constructive engagement help ensure that software supports accurate outcomes, reflects user needs and maintains trust across the market.

Ecosystem commitments

HMRC will:

• support a software market that is thriving, competitive and sustainable
• maintain structured and reliable engagement routes that enable providers to raise issues, share insight and work with HMRC on practical solutions
• set standards that describe the outcomes expected for integrated products
• apply proportionate oversight that maintains system integrity while not stifling innovation and continuous improvement
• take action to address issues with poor quality software that harms the tax and customs system
• provide accessible guidance, reference materials and testing services that help providers build reliable and compliant products
• set clear expectations and guidance on the security requirements and maintain secure integration services that follow HMRC and wider industry best practice
• provide clear, timely requirements that allow confident planning and delivery
• insofar as HMRC can control it, provide clearer sequencing of change and transparent decisions that reduce unnecessary uncertainty

Providers commit to:

• contributing to effective tax and customs administration by designing products, or elements of their product offering, that support accurate tax outcomes and make correct behaviours easier for users
• building and maintaining accurate, secure and reliable products that reflect user needs
• meeting published quality standards for integrated software and providing users with support that helps them achieve accurate and reliable outcomes
• embedding robust security controls in line with HMRC and industry standards
• engaging constructively with HMRC throughout design, testing and implementation
• sharing insight that contributes practical improvements across the ecosystem

Customers can expect:

• software products that are reliable and aligned with their needs, that make it easier to get their tax right and harder to get it wrong
• clear information about how their data is used
• products that apply strong security controls to protect their data, alongside clear information that helps them manage permissions and keep their information safe
• products that are intended to meet applicable standards and support accurate outcomes
• a competitive market that offers choice, accessibility and innovation

3. Our vision — a thriving software market

HMRC wants a thriving, innovative software market that makes it simpler for customers to meet their tax and customs responsibilities, offers fair competition between providers, and supports an effective, healthy, secure tax and customs system.

As more of end users’ experience of the tax and customs system takes place through the software and systems they already rely on, a strong and sustainable software market becomes essential to supporting accurate, timely and straightforward tax administration.

A thriving sector directly supports more efficient and effective tax and customs administration by:

• reducing burden and cost, through modernised, automated processes that remove unnecessary steps
• improving the customer experience, by simplifying and automating core processes so customers can meet obligations with greater ease and confidence
• strengthening tax and duty compliance, by improving data quality closer to taxable events and reducing reliance on manual processes, helping to achieve more accurate outcomes and earlier identification of risks

This vision is reflected in a market that is dynamic, responsive and consistently able to meet customers’ needs, supported by software that is capable, reliable and accessible, and by an environment where providers can plan and invest with confidence.

We champion a market characterised by the following qualities:

1. Seamless tax and customs administration: In this vision, tax processes are embedded into the systems businesses and individuals already use. Customers can meet their obligations within their normal workflows, with fewer avoidable errors and minimal additional steps. Compliance becomes more intuitive because tasks sit naturally within the tools people rely on.
2. Effective response to technology and evolving user needs: A future-ready market must be able to adapt quickly to new technology and changing expectations from customers and advisers. Providers can invest in new capability with confidence because guidance is clear, change is well sequenced and the environment is stable enough to support responsible innovation.
3. Collaboration and mutual trust across the ecosystem: Strong partnership remains central to this vision. Progress is underpinned by constructive engagement between HMRC and the software industry, supported by shared insight and transparent communication that helps ensure decisions support secure, reliable and customer-centred outcomes.
4. High-quality, secure and reliable products: Delivering this vision depends on software that is accurate, secure, stable and accessible. Customers and advisers must have confidence in the software they choose, supported by clear expectations for quality and proportionate oversight that maintains a fair and trusted market.
5. Meeting diverse user needs: A thriving market is one that reflects the range of customers it serves. The sector offers solutions that meet the needs of individuals, micro businesses, SMEs, large organisations, advisers and intermediaries. Products scale appropriately in complexity and support, ensuring users can choose software suited to how they operate.

Moving towards this vision relies on a shared approach, with HMRC and the software industry working together and applying common principles across the ecosystem. The following section sets out how this approach will be put into practice with providers and end users to deliver a modern, digitalised tax and customs system.

4. Strategic approach — increasing partnership and stewardship to support a thriving software market

As software’s critical role in the tax and customs system continues to expand, effective management of the sector becomes increasingly important to ensure that benefits are realised for end users, industry, HMRC and the wider economy. HMRC must take a more active role in shaping a thriving software market that supports the objectives of all stakeholders. Fundamental to this is the continued evolution of our relationships with software providers. Our relationships must continue to develop in ways that support a healthy market that delivers reliable, high‑quality services for customers and commercial sustainability for providers.

Building on the need for a more active and consistent role in the market, we want our relationship with the software industry to operate as a partnership founded on reciprocal trust and accountability. That means being open about what each side needs to deliver well and being willing to tackle problems together rather than working through separate or fragmented channels.

To support this, HMRC will work with developers in more structured and transparent ways so that challenges are surfaced earlier, priorities are easier to understand and decisions are shaped through meaningful dialogue. Providers will continue to bring their knowledge of how users interact with real products, while HMRC provides the clarity and predictability needed for effective planning. By building on the strengths of existing relationships and addressing where current arrangements fall short, we are moving toward a model that treats software providers as essential delivery partners in an effective tax and customs system.

Alongside this enhanced partnership, HMRC must strengthen its stewardship of the market to ensure that software quality supports the department’s compliance and customer experience goals and continues to rise in line with the needs of a modern tax and customs system. Stewardship means shaping an environment that supports responsible innovation, safeguards customers and maintains confidence in the digital channels through which people interact with the tax system. Although most providers demonstrate that they aim to deliver good outcomes for their users, a small number offer products that fall below expected standards and put customers and the system at risk. HMRC must respond effectively where this occurs to protect the integrity of tax and customs administration. HMRC will carry out this role in line with the commitments set out in the HMRC Charter, including fairness, openness and responsiveness in how we work with the sector and uphold the standards expected across the ecosystem.

The following areas describe how this more active role will operate in practice and reflect the shared purpose across HMRC, software providers and intermediaries to support a sustainable, high‑performing software market.

4.1. A more coherent approach to collaboration

Stronger collaboration depends on predictable, consistent and purposeful engagement. HMRC will bring policy intent, operational insight and user needs together earlier in the lifecycle of change so that decisions are better informed and potential issues are addressed before they affect customers. Clearer channels for communication and issue resolution will help providers understand constraints, highlight challenges and contribute meaningfully to shaping workable solutions. Collaboration will involve providers of different sizes and customer groups so that the breadth of the ecosystem is properly represented. This creates a more reliable basis for delivering coherent services and reducing unnecessary friction across the tax and customs system.

4.2. Building support for correct outcomes into software

As software plays a vital role in the way customers interact with the tax and customs system, HMRC and providers each play a part in ensuring that rules and policy intent are reflected clearly and consistently in digital journeys. Responsibility for tax compliance remains with the individual taxpayer, but accuracy is strengthened when the system helps make correct outcomes easier to achieve.

HMRC will provide clearer and more predictable direction on how rules, validations and policy intent should be represented in software. Providers will then contribute insight into how this direction can be applied effectively within digital journeys, using their understanding of user behaviour, product design and where uncertainty or unintended errors can arise. This collaborative approach helps ensure that software supports correct outcomes, while maintaining a clear distinction between customer responsibility for submissions and the standards providers must meet when integrating with HMRC systems.

4.3. Evidence‑led innovation focused on real problems

Innovation is already central to the software market. Providers routinely improve their products by introducing new features, refining journeys and responding to evidence from users and live service data. These changes reduce friction, strengthen accuracy and show that the sector is well placed to lead wider product development without intervention.

Some innovation, however, has a direct impact on tax administration. Work that streamlines tax journeys, reduces avoidable error or supports progress in closing the tax gap benefits from clear alignment and evidence‑led decision making. HMRC’s role is to enable this type of innovation by removing barriers, setting out predictable routes for proposals and ensuring assessments are transparent and grounded in need. HMRC is also willing to support broader innovation where it offers value, while recognising that providers already drive this effectively and are best placed to lead it.

4.4. Predictable change and a stable environment

Predictability and stability are essential for long-term planning and investment across the market. HMRC will improve visibility of future change, set clearer expectations on timing and avoid clustering major changes where that creates unnecessary cost or risk. Providers will plan against this information, highlight where timelines create pressure and coordinate testing so issues can be resolved early. Where fiscal or policy constraints limit early notice, HMRC will set out clear expectations and transitional steps so providers can update their products responsibly and support users smoothly through change.

4.5. Strengthened assurance through proportionate oversight

Continually improving the quality of software across the market is essential for maintaining confidence in the role of software products in the tax and customs system. HMRC will strengthen assurance by establishing a comprehensive oversight framework that spans market entry through day‑to‑day operation, ensuring that products are reliable, support accurate outcomes and protect customers.

HMRC will set clear standards that define the outcomes software will deliver and the behaviours expected of providers. These requirements will be proportionate and transparent. Where a provider does not meet these standards or the integrity of the tax system is at risk, HMRC will take proportionate action. This may include targeted support, temporary restrictions on access to specific interfaces or, where warranted, suspension or removal of integration privileges.

This approach ensures that high‑quality providers compete on fair terms, that poor practice cannot gain advantage and that trust in the wider ecosystem is maintained.

These commitments reflect HMRC’s wider obligations under the HMRC Charter, including being open and responsive, providing clear information and treating all stakeholders fairly.

4.6. A sustainable and commercially viable market

A sustainable software market requires providers to have the confidence and incentive to invest in products that meet user needs and support the effective operation of the tax and customs system. HMRC recognises that its decisions can influence the commercial environment in which providers operate and will take these impacts into account when setting expectations or planning change.

HMRC will act in ways that avoid undermining reasonable commercial opportunities or limiting fair competition. For example, when HMRC provides basic digital tools for essential needs, this will be done in a way that maintains space for commercial products to compete and innovate and will avoid displacing viable offerings that meet diverse customer requirements. We want to support a market where providers can operate with confidence while HMRC maintains the integrity and effectiveness of the tax and customs system.

4.7. Prioritise end user needs in design and delivery

User needs remain the reference point for how HMRC and providers make decisions. HMRC will base requirements and guidance on evidence about how end users use services, and providers will translate this into journeys that reduce complexity and help customers get things right first time. End users will be involved in the design and testing to ensure services reflect operational reality and the support needed in real scenarios.

It is important that end users feel their chosen software products are right for them. They should be supported to make informed choices about what meets their needs. If their needs change, they should be able to move between providers without unnecessary friction, supported by reliable transfer of their data and clear information about any changes that affect them.

Keeping users in view throughout policy, design and technical delivery will result in services that are more accessible, consistent and trusted.

Where end users face difficulties or issues relating to software interactions with HMRC systems, HMRC and software providers will work more closely together to identify and resolve them.

5. Strategic priorities

Delivering the shifts set out in the strategic approach requires a sustained, coordinated programme of work across HMRC and the software ecosystem. These strategic priorities set out the areas where collective effort will focus over the comings years to modernise tax and customs administration and strength the software ecosystem and improve customer experience.

Each priority area describes the purpose, approach and specific themes where further development will take place. Together, they represent a shared commitment to act decisively, ensuring measurable improvements that make tax and customs administration simpler, fairer and more effective for everyone.

These priorities represent a multi‑year programme of reform. Many of the activities described in this section require changes to working practices, governance, technical foundations and engagement models across the tax and customs system. As a result, delivery will be phased and iterative. Some improvements will begin during 2026, while others will mature over several years as shared understanding, evidence and technical readiness develop.

HMRC recognises that the tax and customs system is complex and serves a diverse range of customer characteristics and requirements. As a result, the application of this approach may differ across the software ecosystem and tax and customs regimes.

5.1. Partnership and collaboration

Purpose and strategic goal

By strengthening how HMRC works with providers and user groups, policy intent, operational experience and real usage will inform how services are designed and delivered. HMRC will set and publish strategic priorities for software‑facing change to give the market a clear basis for planning, and collaboration with stakeholders will shape how those priorities are developed and implemented in practice.

General approach

HMRC will put in place a clearer engagement framework that sets when and how providers and end users are involved, how feedback is handled, and how subject matter expertise is accessed during discovery and design. Internally, HMRC will coordinate engagement across policy, operational and technical teams so provider involvement is timely and predictable. Engagement will reflect the breadth of the ecosystem, with dedicated working groups used where specialist issues arise.

Themes for exploration

5.1.1. Involving partners in design

HMRC will embed co-creation as the standard approach, creating opportunities for providers to contribute earlier to the definition of problems, the exploration of design options and the refinement of requirements, ensuring solutions are shaped by real‑world usage and stakeholder insight. This clarity at the earliest stages will help reduce avoidable effort and support smoother implementation.

Providers will be engaged as delivery partners from the outset, gaining early clarity on requirements and integration details to accelerate delivery and minimise avoidable effort. Internally, HMRC will improve alignment, maintain decision trails and ensure that teams apply consistent engagement practices.

5.1.2. New software channel

HMRC will create a dedicated software channel to consolidate guidance, best practice, security requirements, standards and share case studies that raise quality across the market, including for smaller providers. This will help raise quality across the market, support smaller vendors and reduce duplication of effort.

5.1.3. Collaboration on sensitive issues

HMRC will explore more structured approaches to support earlier engagement on proposals that involve sensitive or market‑critical issues. This may include time‑bound access, confidentiality arrangements or other proportionate models that allow participants with relevant expertise to contribute at an appropriate stage. Any approach would need to protect fairness, maintain a level playing field and ensure that participation reflects a broad range of perspectives. Such mechanisms would support earlier dialogue to minimise delivery risk.

5.2. Innovation and integration

Purpose and strategic goal

Innovation should translate into more streamlined journeys, fewer avoidable errors and lower costs for customers and the system. As new technologies and business models emerge, HMRC and providers will need structured ways to explore opportunities, manage risks and maintain confidence in how digital tax and customs services evolve. The goal is to create the conditions that allow safe, responsible and high‑value innovation (whilst ensuring compliance with applicable standards) across the ecosystem.

General approach

Building on the principle of early involvement, HMRC intends to organise innovation activity around clearer lifecycles, more predictable processes and increased transparency about how proposals are assessed. Proposals will be developed and evaluated using evidence about user needs, operational impact and technical feasibility. Providers will contribute insight from research, service usage and customer behaviour so that innovation targets real pain points and genuine opportunities for improvement.

Innovation should remain open to providers of different sizes and capabilities. Approaches will therefore consider how to support participation while avoiding unintended barriers, and how to balance transparency with the need to protect commercial and operational sensitivities. Coordination across policy, operational and technical teams will help ensure that innovation decisions are aligned with wider priorities, and that emerging technologies are explored with a shared understanding of the risks and potential benefits.

Themes for exploration

5.2.1. Exploring opportunities and guardrails for the safe and ethical use of AI in tax software

AI presents opportunities to improve accuracy, reduce friction and enhance user experience within tax‑relevant software. HMRC will explore how these opportunities can be realised responsibly, working with providers, tax advisers and user groups to understand where AI can add value and where clear safeguards are required to protect customers and maintain trust in the tax system.

This work will examine how accuracy, transparency, accountability and user protection should apply to AI‑enabled features, and what guardrails may be necessary to support safe and ethical use. It will build on HMRC’s Guidelines for using generative artificial intelligence if you’re a software developer and  align with established government approaches to responsible technology, drawing on wider public sector experience while focusing on the specific risks and needs of tax and customs administration.

As this exploration develops, HMRC will consider whether additional guidance, expectations or supporting materials are needed to help providers apply safe and ethical practices consistently. The aim is to support innovation that improves customer outcomes while ensuring that AI operates in ways that are fair, reliable and proportionate.

5.2.2. Commercial routes for features without commercial benefit

HMRC will explore commercial routes, including novel and compliant procurement methods, to enable development of features that deliver value solely to HMRC where market incentives would not otherwise support delivery. This approach addresses misaligned incentives by ensuring essential functionality, critical for compliance and operational efficiency, is built even when it offers no commercial advantage to providers. Investment will focus on measurable outcomes, value for money and lessons that strengthen HMRC capability while maintaining fairness and transparency.

5.2.3. Clearer mechanisms on proposals of APIs, data access and integration

HMRC will review and improve processes to co-create mutually beneficial APIs with software providers and review how we fund new APIs outside large-scale change programmes. HMRC will apply clear and consistent criteria when assessing proposals and will provide transparent explanations for decisions. Updates will set out how proposals have been considered and how priorities have been determined.

HMRC will introduce a single, transparent route for the proposals of APIs, data access and integration improvements, so ideas are logged, triaged and responded to consistently. Providers will have confidence that proposals are assessed fairly and predictably, with clear rationales. Periodic summaries and rationales will help the market understand priorities, avoid duplication and align roadmaps, which in turn will speed up the move from idea to implemented improvement.

We will explore the route being available to all stakeholders to also capture end user and HMRC‑led proposals, allowing the market to respond to innovative ideas. The intention is to create a mechanism that encourages participation, supports innovation across providers of different sizes and enables meaningful follow‑through on ideas that offer value for customers, the market and the tax system. We will work with stakeholders to co‑design what a suitable solution could look like.

5.3. Assurance and oversight

Purpose and strategic goal

Trust in software that interacts with HMRC systems is essential for a healthy market and an effective tax and customs administration system. The priority is to set clear, practical expectations for quality and conduct and to develop proportionate oversight that protects users, supports fair competition and enables sustainable innovation. HMRC will be clear about the difference between standards that describe expected outcomes and behaviours for integrated products and requirements that specify technical implementation details. All development in this area will operate within existing legal obligations, regime specifications and contractual frameworks, which remain authoritative.

General approach

HMRC will develop a more coherent and accessible model for assurance that brings together existing obligations with strengthened standards for integrated software. This includes strengthening the standards that apply to software, creating clearer points of entry for providers, improving the reliability and transparency of testing, and making better use of data to understand performance and emerging risks.

All development in this area will remain risk based and proportionate, and existing regime‑specific obligations, legislation and contractual arrangements will continue to take precedence. HMRC will also be more transparent about the level of service and integration behaviours providers can expect from HMRC teams, supporting shared accountability across the system.

Themes for exploration

5.3.1. Enhance standards for software quality

HMRC will work with software providers to define and embed enhanced standards for software that integrates with HMRC systems. These standards will set out the outcomes expected of products, focusing on accuracy, reliability, security and user protection. They may also include requirements for software to present HMRC‑mandated messages at key points in the customer journey where this supports accurate outcomes or safeguards customers. Standards will be developed with input from providers and user groups to ensure that the standards are proportionate and reflect real‑world needs.

5.3.2. Unified registration for software providers

HMRC will develop a single, secure route for providers whose products interact with HMRC systems. A unified registration approach will ensure that expectations apply consistently, provide clarity on how to access HMRC services and improve HMRC’s ability to communicate with providers when needed.

5.3.3. Accuracy, reliability and security testing

HMRC will explore ways to strengthen testing for software that integrates with HMRC systems. This may include enhancing pre‑release testing, supporting post‑release monitoring where appropriate and aligning testing approaches across regimes so that expectations are consistent and accessible to providers of all sizes.

5.3.4. Improved data and analytics on software performance

HMRC will expand the use of data and analytics to identify patterns of error, variations in performance and opportunities to improve journeys involving integrated software. Where possible, HMRC will consider how relevant insights can be shared with providers in ways that support improvement without imposing unnecessary burdens.

5.4. Customer empowerment

Purpose and strategic goal

We want customers to be empowered in their choice and management of software. This means being able to select products that meet their needs, change to alternatives when they no longer do and have clear, usable ways to control how their data is shared between HMRC and software providers. Together, these elements will help ensure customers get meaningful value from the software they use to meet their tax and customs obligations.

General approach

HMRC will focus on practical steps that support customer empowerment and reflect the shared roles of HMRC, providers and customers in how software is chosen and used. This includes considering how to provide clear and neutral information that helps customers understand the options available to them without suggesting endorsement.

HMRC will also work collectively with providers to understand where customers face barriers when moving between products and to identify workable ways to reduce unnecessary friction in switching. We will also work together to identify how best to give customers clearer and more flexible ways to authorise or withdraw data access in ways that are secure, transparent and aligned with regulatory requirements. Through these areas of work, HMRC aims to support customers in making confident choices and getting better value from the software they use.

Themes for exploration

5.4.1. Customer education, information and guidance

HMRC will explore ways to present accessible, neutral information about the types of software on the market and the functions customers may need in different circumstances. This may include high‑level descriptions, criteria linked to integration with HMRC systems and signposting to independent sources of advice, supporting informed choice without implying endorsement.

5.4.2. Customer data authorisation

HMRC will consider options for more streamlined and flexible ways for customers to authorise software to access relevant data where this supports completion of tasks or issue resolution. Models may include use‑case‑based permissions, time‑limited access and delegated authority, designed to give customers greater control while protecting privacy and security.

5.4.3. Switching and data portability

HMRC will work with providers to identify practical steps that support smoother switching between products. This may include promoting interoperable data formats, improving export and import functionality and developing clearer switching journeys. Approaches will draw on lessons from other sectors while remaining proportionate for a diverse market. These improvements aim to ensure customers can change products without unnecessary disruption, cost or uncertainty.

5.5. Technical environment and integration readiness

Purpose and strategic goal

A stable, reliable and well-planned technical environment is essential for a software ecosystem that can grow sustainably over the long term. The goal is to create conditions where providers can integrate with HMRC systems reliably, adapt to change with confidence and build high quality products that work consistently for users. Strengthening the foundations that support integration with HMRC systems helps create the certainty and operational resilience needed for providers to invest, innovate and compete. A technically robust environment also contributes to improved customer experience, lower administrative burdens and better compliance outcomes.

General approach

HMRC aims to maintain the technical conditions that enable providers to build and operate high quality software. This includes ensuring systems operate consistently at scale, improving visibility of technical change and supporting reliable integration pathways across tax regimes.

Further consideration will be given to how best to present indicative timelines and sequencing for upcoming changes, how to communicate the retirement of older interfaces and how to encourage more aligned approaches to testing and issue resolution. Consistent and effective communication with providers will remain important for reducing avoidable effort and avoiding unnecessary disruption for users.

Themes for exploration

5.5.1. Infrastructure upgrades and expanded API capacity

HMRC will invest in technical architecture and capacity so that services are reliable as usage grows. This will help ensure that APIs and integration services perform effectively, reducing delays and supporting smoother interactions for both providers and end users.

5.5.2. Long-term delivery plan for technical change

A stable multiyear view of technical change gives providers time and confidence to adapt, aligns investment decisions across the market and reduces last minute work that drives cost and error. The plan will set out indicative timelines and key dependencies for changes that affect software integration and will highlight any future changes that require products to be updated in advance, supported by clear guidance on how to prepare. It will be reviewed regularly so it remains aligned with policy and operational developments.

5.5.3. Comprehensive testing services and issue communication

HMRC intends to strengthen testing environments so that they reflect the behaviour of live services more closely. This includes developing more realistic end to end scenarios, improving the availability of representative data and aligning test environments with established software development practices. Work will also consider opportunities for earlier access to testing for new or changed functionality, along with clearer diagnostics and improved communication when issues arise. A more consistent approach across regimes will reduce additional effort, improve accuracy and give providers greater confidence in preparing for change. HMRC will also set clearer expectations for incident communication and target response practices that affect integration, so providers can plan and support customers confidently.

6. Implementation plan

The next phase of this strategic approach will focus on developing a coordinated and workable delivery plan through a collaborative approach that reflects the commitments made in this strategy. This will build on activity already underway, including early work on strengthened standards and unified registration that was committed to in the HMRC Transformation Roadmap. The emphasis will be on building shared understanding, identifying where collective effort can add the greatest value and ensuring that implementation is shaped by practical insight.

Work during 2026 will bring software providers, intermediaries and customers together to develop a clearer picture of current activity and to explore where better alignment and sequencing can improve outcomes for customers and the wider system. This will help to identify opportunities to strengthen delivery, reduce duplication and support a stable environment for those who build and use software. The delivery plan will be shaped through collective effort so that proposals are realistic, evidence based and aligned with the needs of the ecosystem.

Initial activity will focus on:

• identifying areas where coordinated action can support better customer journeys and improved compliance
• scoping how the enterprise level actions set out in this strategy should begin to be taken forward
• developing a shared view of priorities, constraints and delivery risks
• agreeing how activity can be sequenced so that stakeholders have sufficient visibility and time to plan with confidence

HMRC intends to publish the detailed delivery plan by Spring 2027. This will set out initial actions, milestones and indicative timelines, with further refinement as shared understanding develops. The plan will evolve as new insights emerge, allowing it to remain grounded in evidence, responsive to operational realities and aligned with the shared purpose that underpins the strategic approach.

Through this collaborative programme of work, the implementation phase will deliver a practical plan that supports sustainable improvement across the tax system and strengthens the wider software ecosystem.

6.1.Governance and accountability

Delivery will be overseen to ensure risk management, transparency, and adaptive decision making, with clear structures and responsibilities. A dedicated Steering Group, chaired by a senior HMRC official and including representatives from the software industry, customer groups, and independent experts, will monitor progress, review risks, ensure transparency through public reporting, and advise on adjustments in response to feedback and changing circumstances.

6.2. Measurable objectives and success metrics

HMRC will develop a set of measurable objectives and supporting metrics to track progress in delivering this strategic approach and to understand its overall impact on the software ecosystem and the tax and customs system. The development of these measures will be aligned with the creation of the delivery plan, with formal tracking beginning in Summer 2027.

Metrics are expected to cover themes such as:

• market performance and resilience: this may include indicators such as the number and diversity of software providers, patterns of participation across customer groups and other measures that help assess the health and sustainability of the market including the commercial success and growth of the sector
• the contribution of software to effective tax and customs administration: HMRC will explore ways of understanding how integrated software supports accurate outcomes and reduces avoidable error. While responsibility for tax liabilities remains with customers, we expect that clearer design, better support and strengthened standards will contribute to progress in closing the tax gap
• customer experience and administrative burden: measures may include customer satisfaction with the software they use, clarity and ease of digital journeys and evidence about whether software reduces the time and effort required to meet tax and customs obligations. Approaches will draw on methods similar to those used in the Transformation Roadmap, including customer research and service insight

These measures will be refined with providers, user groups and internal stakeholders to ensure they are proportionate, meaningful and practical to track over time.