After a consistent downward slide in service levels over recent years, the Treasury has announced new ring-fenced funding of £51million to help HMRC’s phonelines meet service standard targets. 

The additional resources have been announced after HMRC performed a swift U-turn after announcing plans to permanently restrict, or close, taxpayer self assessment, VAT and PAYE support lines. The plans were withdrawn just 24 hours after understandable condemnation from taxpayers and professional bodies. 

When HMRC chief executive Jim Harra appeared before the Treasury Select Committee over the plans to close helplines, he argued that HMRC lacked the funding to increase helpline resources. 

The problem, which has been increasing for years, has worsened as more people need to pay tax because of inflation and fiscal drag, while HMRC’s resources have been squeezed since their spending review settlement in 2021, where limited funding was assigned for the development of digital services. 

The Treasury noted in the press release that HMRC has received a £900m cash increase from £4.3bn in 2019/20 to £5.2bn in 2024/25.

Online service remains the primary objective…

HMRC’s Jim Harra has said HMRC is still ‘committed to expanding our online services, and encouraging customers to go online where they can’ but acknowledges that this must ‘happen at a pace the public is comfortable with’. He also acknowledged that some people, the elderly or vulnerable, may be unable to access online services at any point and will continue to require a helpline.

HMRC estimates that two-thirds of self assessment calls can be dealt with online, and is still set on maximising its ‘efficiency-improving long-term strategy’ of becoming digital by default and directing taxpayers to use resources on gov.uk and the HMRC app. 

Long wait times are frustrating…

The current likelihood of long wait times when calling HMRC helplines has become expected for taxpayers and accountants and is a frequent industry complaint. Agents can’t pass on the cost of long waits to clients, who also lose productive work time hanging on the phones and delay the calls as a result.

The Public Accounts Committee blasted poor service levels back in February as HMRC’s performance continued to deteriorate. 

Industry reaction and our view!

The overwhelming response from our industry colleagues is relief that we have finally been listened to!

There is also a wariness though, that what sounds like a huge sum is put to good use, as it could disappear very quickly. 

The other concern is that these funds will not result in an immediate improvement, as extra staff need to be found and trained before they can be deployed, and the online systems that can reduce pressure on the phone lines are improved to become the credible alternative that is needed. It’s likely to be some time yet before any marked improvement is felt by callers and agents.

It’s vital that effective phone support is available until these effective digital services are running smoothly and can be used, and recommended, with confidence.

We’ll keep you posted on progress, but in the meantime, will continue to do all we can to help you avoid having to contact HMRC!