Brexit delays HMRC’S simpler tax return system

A DIGITAL revolution in the UK tax system has been postponed as tax collectors and customs officials are too busy preparing for Brexit.

The taxman had been trying to end the need for filing traditional returns by 2020. Experts say this is now unachievable. A notice sent out yesterday said the overhaul, which would have led to five million taxpayers filing prefilled forms instead of filling out blank ones, has been put on ice indefinitely.

So-called “simple assessments” were being introduced to make the filing process easier. Despite being paperbased, HMRC intended to use the information it already had to calculate the tax owed by citizens, rather than require them to submit a tax return.

HMRC said: “We have made the decision to delay plans to release project capability to EU Exit work. This means halting progress on simple assessment and real-time tax code changes. The MTD [Making Tax Digital] for Individ- uals programme has made significant progress, so we’ve laid foundations that will enable us to return to this.”

Topping the list of HMRC priorities is building a new customs declaration service which can cope with the expected huge increase in customs declarations after the UK leaves the EU in March 2019.

Experts said that although taxpayers would have to wait longer for the simpler system, the delay would likely mean fewer technical problems. So far relatively small numbers of taxpayers have moved over to the system but tax experts have reported issues with inaccuracies with pre-populated data.

HMRC also admitted its digital regime had so far resulted in a higher volume of phonecalls from taxpayers needing help.

A spokesman said: “It hasn’t all been smooth sailing. We were overly ambitious about the number of customers who would stop contacting us.”