HMRC increased tax revenue collection rates in the first six months of 2014, but is still having problems handling taxpayer inquiries in a timely fashion and within targets, reveals the latest mid-year report to parliament
The report covers the period from April to September 2014 and assesses HMRC’s performance against its key objectives of maximising revenues, improving the service to taxpayers and making sustainable cost savings.
Just over two thirds (69%) of post was cleared within 15 working days, compared to 77.3% at the same point last year, largely because staff were diverted to deal with tax credits renewals inquiries this summer.
While HMRC says customer post levels are falling as a result of improved call handling and increasing use of online services, the current backlog means it will not meet its target of clearing 80% of post within 15 working days this year.
There have also been problems with handling calls to helpline, with the response rate in the first half of the year falling by 1.8% to 74.5%, compared to the same point last year. HMRC says it expects to achieve a more consistent performance throughout 2014-15, although it is not as good as in 2013-14, when the response rate was 79%.
The report notes that total tax revenue in the first half of the year of £243.6bn is about £7bn more than brought in at the same point last year. HMRC is on track to deliver their target of just under £1.2bn in savings by 2015-16.
At the end of March 2014, total debt was £16.7bn and this is expected to rise in 2015 (because more debt owed has been identified through compliance activity).
The report states: ‘We’ve had some notable successes in the first half of the year, including tax credits renewals and introducing new digital ways of working, as well as some significant challenges.
‘We have some stretching targets to achieve another record year for collecting additional compliance revenues, while we implement some significant changes in how we serve our customers.’
There was better news on tax credits, where 89% of calls on 31 July were answered this year compared to just 16% last year. UK tax credits and child benefit claims and changes of circumstance were cleared in an average of 15 days (with the target being 22 days) and international claims and changes of circumstance were cleared in 80.3 days (with the target being 92 days).
The report is available at https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/389343/4522_Mid_Year_Report_v10_accessible.pdf
