Chancellor Halts HMRC Plans to Close Helplines

Jeremy Hunt has acted on the public backlash against proposed plans to close HMRC helplines for 6 months each year.

In a dramatic change in how they deal with public enquiries about tax returns, HMRC had decided to close its busy tax helpline for half the year, every year. Their helpline would have been closed from 8^th April to 30^th September, resurfacing only for the busy winter period.

As well as the summer closure of its tax helpline, HMRC declared that its VAT helpline would only be open for five days per month, and its PAYE helpline would no longer take any calls enquiring about refunds they’re owed.

Rather than a cost-cutting measure though, HMRC have hailed the move as a “vital element” of its move to an online self-serve model instead. HMRC’s Deputy Chief Executive, Angela McDonald said that “changing our services to encourage customers to self-serve online wherever possible will allow our helpline advisers to focus support where it is most needed – helping those with complex tax queries and those who are vulnerable and need extra support”.

Under pressure from scores of MPs and stakeholders, Hunt has since ordered that HMRC keep their phonelines open.

A controversial change

The move away from helplines built up an army of critics. Head of Tax Dispute Resolution at BDO, Dawn Register, was sceptical of how useful the change would be, predicting instead that it would “make tax compliance harder”.

Gary Ashford, a spokesperson for the Chartered Institute of Taxation, meanwhile, shared a similar sentiment, calling the move “misguided”. He added that his organisation was “concerned there may be an increase in how many will include estimates or errors because of the inability to seek clarification from HMRC”.

It was certainly a bold move for HMRC to make so soon after their customer service was slammed by a public report. A parliamentary spending watchdog described HMRC’s customer service levels as having sunk to an “all-time low” less than a month ago. The report found that 62% of callers waited more than 10 minutes to speak to an adviser, a 46% increase from 2021-22.

The report found that it took an average of 16 minutes for customers’ calls to be answered, while a recent Guardian article reported even worse. Their story revealed hour-long waits and customers being cut off before their call is even answered.

Ben Westoby, senior client manager at Forbes Burton, expressed his own reservations about HMRC’s proposed move, saying that “the whole thing seemed counterproductive”. He suggested that “with recent reports damning their customer service helplines, the last thing you would expect HMRC to do is restrict their phonelines even further.

“While I can see the logic in implementing this during their quieter summer months, surely it would have only created a larger bottleneck when the lines finally opened in October. It also muddied the message that HMRC has been trying to tell us for years, and that’s for businesses to file their tax returns early”.

HMRC’s test pilot

It’s unlikely that HMRC didn’t foresee this change as a controversial one, but they’ve been clear with the direction they want to take. The Public Accounts Committee’s report told of how HMRC were attempting to move away from phonelines with an emphasis on chatbots and YouTube how-to videos instead.

A Gov.uk press release, however, suggests that a “successful seasonal pilot” demonstrated that the new approach works. It explained that “the changes enabled HMRC to help more customers and did not impact on customers’ ability to file or pay on time – with a record 11.5 million filing their return by 31 January 2024”.

With the chancellor’s intervention now scuppering their plans to roll this change out permanently, HMRC will have to bide their time before attempting anything similar again. While HMRC will point to the claimed success of their closure between June 12th and September 4th last year, ministers seem unconvinced that suitable safeguards are in place for a full switchover to digital services.

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