In the roadmap published on 21 July 2025, HMRC explains how it will achieve the following priorities set for it by the government:

• improving day-to-day performance and the customer experience, mainly by expanding the range and type of digital services it provides; 
• closing the tax gap; and 
• reforming and modernising the tax and customs systems.

HMRC’s strategic objectives reflect these priorities and include:

• building a high-performing organisation with a skilled and engaged workforce; and
• supporting wider government economic aims through HMRC’s work.

New and improved digital services

HMRC intends to become a digital-first organisation, with at least 90% of interactions undertaken digitally by 2029/30, up from 76% at present. To do this, HMRC will deliver more digital self-serve options for taxpayers and agents.

The full list of deliverables is set out in Annex B of the report. A key initiative is the roll-out of a new online service for pay as you earn (PAYE) taxpayers in 2025/26. In a press release published alongside the roadmap, HMRC says that the new service will “make it simpler and easier” for PAYE taxpayers to “check and update their income, allowances, reliefs and expenses”. The service will be available via the individual’s personal tax account or through the HMRC app.

Significant changes are planned for the HMRC app and online tax accounts, which will become “the first point of contact” with HMRC for many taxpayers. The roadmap explains that the app and accounts will be accessed through a “more straightforward and secure login process and enhanced by new AI powered assistants, voice biometrics and personalised digital experiences that make it easier for customers to navigate their tax affairs”.

HMRC also says that it intends to work with tax advisers and professional bodies to develop and deliver improved services for agents. HMRC will:

• modernise and mandate tax adviser registration from April 2026, with streamlined registration processes;
• modernise digital identity for tax advisers and how they are authorised by their clients;
• provide secure three-way communication between HMRC, its customers and their agents by the end of 2028;
• prioritise work starting in 2025 to:
  • introduce new capabilities to enable agents to digitally withdraw their clients from self assessment;
  • enhance the income record viewer to expand the information available;
  • launch a new service to allow agents to digitally submit information that may impact their client’s tax code; and
  • provide the ability for agents to track the progress of their client’s submissions and repayments.

The roadmap acknowledges that compromises have been made in the design of digital services, which have reduced HMRC’s ability to deliver access to good quality services for agents.

Frank Haskew, Head of Taxation Strategy, ICAEW, said: “Services for tax advisers continue to lag behind services for taxpayers. Meaningful transformation of digital services for tax advisers hinges on the development of new platforms and agreed permissions. The gap in services available to taxpayers and agents will grow in the short term, while improvements for tax agents to address key pain points will be a tactical stop-gap solution until new platforms are established”.

Closing the tax gap

The difference between what HMRC expects the total tax take to be and the actual tax received – the tax gap – was £46.8bn for 2023/24, equal to 5.3% of total tax liabilities. The roadmap explains that HMRC will invest “in its people, services, standards and technology” to help close the tax gap. Measures announced previously and reconfirmed in the roadmap include investing in new compliance and debt management officers and expanding its counter-fraud capability.

The share of the tax gap attributed to small businesses has increased in recent years, from 48% of the overall tax gap for 2019/20 to 60% for 2023/24. HMRC says that it will “take a multi-faceted approach to address the small business tax gap through digitalisation, use of third-party data, and improving standards in the tax advice market”.  It highlights that deliberate non-compliance by small businesses includes taxpayers under-reporting their income and/or over-reporting their expenses.

The roadmap reconfirms that tax advisers will be required to register with HMRC. In addition, HMRC says that it will improve its use of third-party data to “automatically register customers to make it easier for compliant customers to meet their tax obligations and to bring those who might otherwise seek to hide their income to avoid paying tax into the system”. It is not clear what this will involve.

Following a consultation issued at the Spring Statement 2025, the roadmap confirms plans to enhance HMRC’s powers and sanctions to act against tax advisers who facilitate taxpayer non-compliance. ICAEW warned in its response to the consultation that the measures could adversely affect the operation of the UK’s tax advice and compliance market. HMRC is still exploring next steps on raising standards in the tax advice market, following the summary of consultation responses published in October 2024.

Third-party software developers are also playing an increasingly important role in the tax system and potentially reducing the tax gap. A dedicated roadmap setting out HMRC’s approach to software in the tax system will be published by April 2026.

Reforming and modernising the tax system

According to the roadmap, HMRC will:

• overhaul its legacy IT infrastructure, including its corporation tax system;
• invest in AI, data capabilities and new platforms;
• simplify tax rules and reporting thresholds. This includes increasing the income tax self assessment trading income reporting threshold, as first announced at a joint ICAEW and Chartered Institute of Taxation event in March 2025; and
• work with other UK government departments and devolved bodies to share data and trial processes.

The roadmap confirms that HMRC does not intend to introduce Making Tax Digital for corporation tax. Instead, HMRC is developing an approach to the future administration of corporation tax that is suited to the varying needs of the diverse corporation tax population.

Looking further ahead, HMRC will explore the increasing role of intermediaries in administering the tax and customs systems and make use of “machine learning and Generative AI to streamline administrative tasks such as summarising customer calls”.

How change will be delivered

The roadmap explains that HMRC will deliver change differently, moving away “from longer-term, larger-scale programmes and into a model of delivering regular, iterative, user-tested changes”. HMRC believes that this will allow it to make improvements more quickly. HMRC has also made a commitment to developing and delivering changes “in greater consultation with stakeholders in the wider tax and customs landscape including agents and software developers”.

Further information

• Read more about ICAEW’s views on HMRC's Transformation Roadmap

Links:

• Written questions, answers and statements - UK Parliament