Source · Select Committees · Public Accounts Committee
Recommendation 22
22
Accepted
HMRC lacks clear plans for supporting lower-income and vulnerable Making Tax Digital taxpayers.
Conclusion
In December 2022 Ministers took the decision to delay the inclusion of taxpayers with Self Assessment incomes below £30,000 in Making Tax Digital due to concerns about customer costs and burdens. Many of HMRC’s stakeholders have welcomed this decision.49 However, HMRC could not tell us its plans to provide specific support to those taxpayers with lower incomes, or who are more vulnerable, except for those who may be entitled to an exemption from being mandated.50 HMRC also said it would now need to stratify the customer costs and burden information it held for those with incomes over £10,000 into HMRC’s new income groupings for those with incomes over £50,000, those between £30,000 and £50,000 and those below £30,000.51 HMRC said it still needs to test if the additional financial and administrative burden is likely to be higher for those at the bottom end of the income scale.52
Government Response Summary
The government has established an expert panel to consult on digital improvement ideas and provide specific support for vulnerable or digitally excluded customers, addressing the committee's concern about a lack of plans for these groups.
Government Response
Accepted
HM Government
Accepted
In December the government announced that the introduction of Making Tax Digital for Self Assessment would be delayed again, and the number of taxpayers affected would be reduced. Those businesses and landlords with Self Assessment incomes above £50,000 will be required to use the new system first in 2026, then those with incomes between £30,000 and £50,000 in 2027. The programme for those with incomes between £10,000 to £30,000 has been put on hold until further notice. HMRC has also established an expert panel to consult on digital improvement ideas which provides insight into how to implement changes and provide the right support for vulnerable or digitally excluded customers.