GovWire

The OTS has published an evaluation update paper on the Single Customer Account.

This paper on the Single Customer Account is one of four separate notes accompanying the OTSs everyday tax evaluation paper, providing an update on its 2019 reviews about simplifying everyday tax for smaller businesses and taxation and life events.

The OTS has carried out its work in the light of the changes in the wider context since the two reports were conducted, in particular recognising the significance of the governments Tax Administration Strategy, HMRCs Tax Administration Framework Review and the Single Customer Account.

Key issues relating to the Single Customer Account

The OTS recognises the impact that the COVID-19 pandemic has had on all government work streams, and the necessary diversion of HMRC effort that has been needed.

The pandemic has also opened up new benefits through increased digitisation and different ways of working. COVID-19 has highlighted the importance of the tax system in delivering targeted support to people and businesses, and HMRC have shown themselves capable of rising to the challenge.

In that context:

• the Single Customer Account is an exciting vision forming the keystone of the governments 10 year strategic plans for administrative reform. It will need significant commitment and continued funding over several years to develop a mature product

• the OTS considers that it would be very helpful for HMRC to provide an indicative roadmap for the Single Customer Account for individuals soon, setting out key development stages at which additional functionality or areas of tax would be added, and target dates

• alongside this, HMRC need to strategically plan an ongoing staged launch process for the new account so that individual taxpayers and others will be ready to fully engage with and benefit from the new system as soon as it is rolled out and as additional functionality or elements are added, as set out in the roadmap

• as well as including the facility to handle a progressively greater variety of types of Claims and Elections, and Capital Gains Tax, the account should also include the State Pension and could potentially be extended in time to include some Social Security benefits

• as much of the data used to populate the current accounts is Pay As You Earn (PAYE) data, the OTS considers that HMRC should overhaul the PAYE system at the same time as developing the Single Customer Account. The OTS has published a separate update note on improving the operation of the PAYE system

• HMRCs strategy for the Single Customer Account also needs to be closely aligned with HMRCs agent strategy, with appropriate agent access to data being built in from the beginning. The OTS has published a separate update note on agents

• the OTS suggests that HMRC should consider immediate improvements that could usefully be made to the Personal Tax Account in the short term, such as prompts relating to the High Income Child Benefit Charge (see the separate OTS HICBC update note)

Notes for editors

The OTS is the independent adviser to government on tax simplification, challenging tax complexity to help all users of the tax system; it does not implement changes - these are a matter for government and for Parliament.

The OTS works to improve the experience of all who interact with the tax system. It aims to reduce the administrative burden - which is what people encounter in practice - as well as simplifying the rules. Simplification of the technical and administrative aspects of tax are each important, both to taxpayers and HMRC.

The OTS has previously published an evaluation update on its 2017 VAT review in October 2019, an evaluation and stocktake note on its 2017 Corporation Tax review and 2018 Accounting depreciation or capital allowances review in July 2020 and an evaluation paper on its 2018 review on HMRC Guidance in March 2021.

An index of all OTS publications is also available.

Press Enquiries only please contact Julie Gillespie, OTS Press Officer Phone 03000 585028.