HMRC’s customer service is in the spotlight once more

January’s PAC report into HMRC’s services was incendiary. Here’s our take on it.

One of the big stories to emerge in January was the publication of the Public Accounts Committee (PAC) report into HMRC’s Customer Service and Accounts. The incendiary headline from the PAC’s own press release accused HMRC of deliberately degrading its own telephone service in a bid to drive more of its customers to use their online digital services. 

HMRC’s CEO, Jim Harra fiercely rejected this accusation, describing it as “completely baseless”. 

Declining service

The PAC’s report did, however, highlight that there had been a continued decline in HMRC’s customer service. Evidence showed 66% of customer attempts to speak to an adviser were answered, against a target of 85%, and average call waiting times exceeded 23 minutes. Indeed, over 44,000 customers were cut off after waiting on the telephone for over 70 minutes.  

Harra explained that the decline in standards of the HMRC telephone service was caused by a growing taxpayer population with more complex needs, compounded by HMRC’s budget constraints. 

The PAC is appointed by the House of Commons to examine the value for money of government projects, programmes and service delivery. AAT responded to two calls for evidence on this matter in 2024, with the PAC issuing requests in both May and November.

Our feedback

In our most recent response, we stated that effective customer service delivery is essential to meeting the Government’s objectives of closing the tax gap, protecting funding for public services and improving productivity. We shared members’ feedback that HMRC’s customer service performance continues to decline and remains an area of growing concern to AAT members and the wider accountancy profession. 

Members have told us that HMRC’s unresponsive and inefficient services mean they routinely face severe delays, business disruption and productivity losses. HMRC’s Charter Annual Report showed that HMRC received 92,206 complaints in 2023/24 – an increase on the previous year. Plus, customer satisfaction with tax agents fell by 7% to 37%. 

We welcomed the Government’s Budget announcement setting out details for new investment into HMRC. We also recognise that HMRC has been working hard in recent years to deliver improvements and solutions, but it has been hamstrung by consistent underinvestment. The trend of contending with both significantly increasing demands and declining resources has posed substantial issues for HMRC and its ability to collect tax and handle customer inquiries effectively and efficiently. 

Whilst extra investment is essential, it is not the only solution. Digitisation should be progressed without any further delays, co-designed more with software developers, and accompanied by targeted support for those who are digitally excluded. A long-term strategy for HMRC, including tax simplification and workforce planning, would also help. 

We continue to engage directly with HMRC to support the delivery of its objectives.  

Most recently AAT’s Chief Executive, Sarah Beale, was invited to participate in a roundtable with other professional accountancy and taxation body representatives by HMRC’s Director General, Customer Strategy & Tax Design. At the meeting, HMRC continued with their commitment to listening to members’ feedback shared by key professional bodies, of which AAT is one.

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