Opinion: dealing with HMRC has never been worse

Service levels by the taxman have dropped to an ‘all-time low’ – and it is taxpayers who are suffering, writes John Fitzsimons.

The customer service levels at HM Revenue & Customs (HMRC) have dropped to an ‘all-time low’.

That’s the damning verdict of Parliament’s Public Accounts Committee (PAC), which conducts an annual investigation into the performance of the taxman, and declared that its latest service levels had continued a five-year decline to reach new depths.

So where is it going wrong? And why does it matter for all of us?

Hanging on the telephone

If you have a question about your tax arrangements, then your first tactic may be to give the taxman a call.

After all, that way you can get some guidance on your personal situation. 

The trouble is that actually getting through to speak to someone is far more difficult than you might expect.

Back in 2021-22, almost half (46.3%) of callers had to wait more than 10 minutes to speak to an adviser, which was already unacceptable.

Yet for the 2022-23 financial year, that proportion of callers had grown to 62.7%.

That’s absolute insanity, for almost two-thirds of callers to know they will be on hold for at least 10 minutes.

That’s just the minimum, remember ‒ there will be individual cases where the wait time is far more significant.

HMRC has blamed the rising demand for help, stating that there has been a 10% jump in demand for its postal and call services over the last year, without a similar increase in resources. 

Have you looked online?

Given this situation, HMRC is instead increasingly directing people with queries to check whether they can find answers online, through the taxman’s various digital services.

The taxman said that the majority of people already engage with their taxes digitally, and there are “safe, secure and good-quality digital services” on offer.

That would be great if it was actually true. Unfortunately, an awful lot of the people and organisations that have had to use these digital services would describe them rather differently.

As the report points out, there was plenty of criticism of the digital services from users, with suggestions they had been implemented poorly, without proper testing, and without the functionality needed to actually be useful.

In other words, people try to phone for advice and are instead directed to online support and features which are barely fit for purpose, meaning that in many cases they end up going back to waiting on the phone again. 

The whole system simply doesn’t work.

If you really do need to contact HMRC, check out our guide on the best ways to do so.

Adding to taxpayer stress

Dealing with the taxman is a nerve-wracking experience at the best of times. The vast majority of us don’t want to have a prolonged discussion with HMRC ‒ we just want to pay the right amount, and get it done quickly.

But when it’s this difficult to actually get proper guidance and advice from the taxman, particularly at a time when far more people have some level of complexity in their circumstances, that is often not possible.

Instead the whole process is dragged out, making it infinitely more stressful, besides the fact that it makes it all the harder for taxpayers to actually ensure they are paying the correct amount in levies.

This matters for all of us

Now, if you have simple tax arrangements and never have to deal with HMRC, then it would be easy to look the other way here.

If you aren’t being pushed around the houses in trying to get tax help, or spending hours on hold in order to get some advice, then it might not seem like a big deal.

However, the reality is that we all suffer from the taxman being in such a state.

The PAC report noted that while tax revenues are at a record high, with a whopping £814 billion brought in over the 2022-23 tax year, HMRC fell short of its ‘compliance yield’ target.

That is the additional revenue that would be lost without the taxman getting involved, cracking down on those who have not paid enough tax, knowingly or otherwise.

The target was £36 billion, and HMRC fell £2 billion short. What’s more, it expects to do so again in the coming years.

That’s money that should be coming in, and which could be used to fund public services, or even the taxman itself so that it’s less of a chore to deal with.

HMRC is in a bit of a state, and has been getting progressively worse for some time.

Resourcing is undoubtedly an issue – if you are struggling to deal with demand, then you evidently need more staff on hand, who are able to advise those needing help.

And while HMRC is absolutely right to focus on beefing up the amount of support available online, right now it isn't up to scratch.

Those of us of a certain age will remember the taxman's adverts, with the tagline 'Tax doesn't have to taxing'.

Unfortunately, it's HMRC itself which is making the experience more emotionally taxing than it needs to be.