What the Chancellor should know about HMRC’s poor service levels

Frustrations are leaving some accountants feeling that HMRC is working against them.

AAT led several professional bodies in signing an open letter to Chancellor Jeremy Hunt ahead of the Spring Budget 2023, urging the Treasury to ‘prioritise’ investment on HMRC in a bid to improve declining service levels.

The letter states HMRC customer service staff numbers have been cut by 24% since 2018, from 25,500 to 19,500. Long delays, call-hold times and reduced operating hours of dedicated phonelines have all become a ‘regular occurrence’. Businesses, accountants and taxpayers alike are experiencing ‘delays, business disruption and frustration’, the letter adds, while urging the Chancellor to prioritise investment in HMRC in next week’s budget.

But back in January, MPs warned it was ‘unlikely’ that HMRC service levels would improve quickly.

HMRC has struggled with a myriad of issues and backlogs, and faced additional pressures in December and January to address these. Common problems and complaints included:

• slow – or lost – service connections.
• system outages and ongoing technical issues.
• huge delays in responding to queries (at one point, the department had a 3.3 million post pile up)
• long call-wait times.

Ahead of the budget, we spoke to three accountants about their frustrations with HMRC and what improvements they’d like to see in the department.

Make more HMRC services available online

Lauren Harvey, Assistant Accounts Manager, The Accountancy Partnership

We’ve noticed increased waiting times for HMRC over the last few months, both for phone calls and responses to letters. This has caused clients to become frustrated with us, but we have no control over it.

In January, HMRC added a new process whereby it would only discuss ‘urgent’ self-assessment queries with us via the self-assessment helpline. However, our understanding is that all SA queries in January will be urgent! It was also impossible to get an answer from the agents as to what they classed as ‘urgent’.

In cases where the agent will only speak to the client directly, for example when discussing payment plans, nine times out of 10 clients tell us they’ve been trying to get in touch with HMRC for days with no response.

HMRC has recently taken steps to make more services available online which allows us to view and amend details more easily. However, a number of queries still require you to write to HMRC. It would be brilliant if such processes could be moved online so queries can be answered, or investigations can be resolved, in a more timely manner.

Verdict: There have been longer delays recently, frustrating accountants and clients alike. More online services are desperately needed.

Inconsistent service levels with limited support from phone lines are a big issue

Joanne Thorne, Technical Compliance Manager, SJD Accountancy

Inconsistent service levels are causing the general frustration many businesses face when dealing with HMRC. Users frequently report being on hold for about an hour. And the person they get through to is not always helpful: callers are frequently asked to repeat their issues with each new call.

Often calls offer very little resolution and instead, customers have to go through a lengthy process of waiting to speak to someone who can actually help them.

Although individuals can now seek help through online chats, these services are as understaffed as the phone lines, resulting in the same – or bigger – frustrations.

I’d like to see:

• Increased HMRC staffing. Improving services starts with hiring enough well-trained staff, who are connected with back-office systems, processes and people, and can therefore be proactive when solving a query or handling a complaint.
• Opening up the closed back-office teams to respond directly with clients would be a great help, especially if they are the only people who can resolved queries and issues.
• Invest more in digital technology such as mobile apps and self-service channels.

Verdict: HMRC would benefit from improvements and investment in all areas: staffing levels, technology infrastructure and customer service.

HMRC delays and inefficiencies are damaging our own client relationships

Sam Mitcham FMAAT, Founder of SJCM Accountancy

We would like to see HMRC working together with us instead of what feels like against us. We’re constantly being told certain information is ‘no longer accessible’ via a phone call and we have to write instead, or ask clients to make the call themselves. This damages client relationships some of whom say, out of understandable frustration, ‘‘isn’t this what we pay you for?”

HMRC are attempting to move us into a digital world, but their own systems do not reflect this: we are still expected to correspond via post on many matters which seems ironic given that ‘making tax digital’ is high on their agenda.

There’s inconsistency with API viewers: some information is accessible and some isn’t – there’s just no logic to it. For example, why can’t we or the client see all tax deducted by contractors under an individual’s UTR? While clients have an obligation to ensure they have CIS subcontractor statements, if we could cross-check this information with HMRC, this would make the process slicker.

We’re also experiencing the longest delays we’ve ever seen for VAT numbers being issued. This is creating difficult situations for our clients, who are often new in business.

It means having to amend invoices to their clients and suppliers at a later date which puts an added complication into the mix for us as agents, and for the client and their bookkeeper.

There are also incredibly long response times for replies to letters. It can take HMRC months to even open a letter, never mind process and respond, meanwhile they often continue chasing clients for tax which isn’t due or information which we have already sent in.

This makes it difficult for us to bill for work. We cannot add a line on an invoice saying: “sending the same information to HMRC twice” or “spending an hour on hold to HMRC to chase a reply to written correspondence”!

Verdict: HMRC delays and inefficiencies are damaging relationships with our own clients. Its systems don’t reflect its own push to make tax digital. It feels like HMRC is working against us.

Annie Makoff is a freelance journalist and editor.