Improving HMRC's online guidance is essential

25 April 2023
For many unrepresented taxpayers faced by a tax question, their first and possibly only port of call will be the HMRC website. The tax system is hugely complex and failure to comply can be costly and stressful. It is therefore essential that this is accurate, easy to search and understandable. The Low Incomes Tax Reform Group (LITRG) have recently produced a report setting out issues with current HMRC guidance and suggested 40 improvements to this vital resource. 

Advice should be correct as well as easy

When HMRC tests guidance it often asks if a taxpayer found it easy to follow. It does not necessarily check it has produced the right result for that taxpayer, a problem that can arise if a question is ambiguous. For instance, common terms like ‘income’ need to be defined. On a section advising on property income, the word is used at one point in the sense of gross income (before expenses are deducted), whereas later, it is used in a reference to net income (after expenses are deducted). Definitions need to be clear if people are to get the correct advice. The statement that ‘you do not pay tax on your savings interest if you are on a low income’ is virtually meaningless where ‘low’ is not defined.

Advice needs to be up to date

The online advice needs to be updated when the law is changed and reviewed to check it reflects the final understanding of how the law applies if the interpretation changes over time. 

Guidance should be clear and unambiguous

People need to be able to follow the guidance and come to the correct conclusion without confusion or ambiguity. For example, clarity can be obscured as the government style guide does not allow the use of ‘or’ or ‘and’ after bullet points. Do you need to meet all the conditions to qualify for a certain treatment, or just one of them? This makes bullet point lists of conditions difficult to interpret, without careful writing of the surrounding paragraphs.

There should be a legitimate expectation advice is complete and correct

The website has disclaimers and at some points even suggests that taxpayers seek professional advice in certain situations. Given that this is the HMRC website, how can it be right that it is claiming it cannot be relied upon, or that it will not help taxpayers in complex situations? It could be argued that the support for unrepresented taxpayers should be better, as people need to be able to trust HMRC or they may lose faith in the tax system overall.

Could do better

A significant number of people rely on guidance on the HMRC website to help them through the complexities of the UK tax system. As local support and telephone support become harder and harder to obtain this is their only trusted source of help. We agree with the LITRG that HMRC should be assisting them in every way possible. People need support, if they get it wrong due to misleading guidance, they should be credited for their attempt to use it, not penalised for their error.

Although HMRC’s resources are limited, good clear reliable advice cuts down on taxpayer errors and increases faith in HMRC, while poor guidance costs time, money and trust.