Tax admin changes to mean up to 300,000 taxpayers will no longer be required to file a tax return.
Easier access to tax relief on temporarily imported fine art and antiques often shown in galleries and exhibitions announced, boosting the sector's international competitiveness.
UK's tax minister expected to announce these alongside a raft of other measures to help HMRC deliver Plan for Change through securing tax revenue and creating the conditions for growth in speech later today (11 March).
Up to 300,000 people, including those with side hustles, will no longer need to file a Self-Assessment tax return, tax minister James Murray is expected to announce in a speech later today.
This includes people trading clothes online, dog-walking or gardening on the side, driving a taxi, or creating content online.
As part of a bold new package to transform HMRC into a quicker, fairer and more modern body the minister is expected to announce plans to increase the Income Tax Self Assessment (ITSA) reporting threshold for trading income, from £1,000 to £3,000 gross within this parliament.
This will help deliver the Plan for Change by freeing up time for taxpayers helping to create the conditions for economic growth.
This will benefit around 300,000 taxpayers. An estimated 90,000 of them will have no tax to pay and no reason to report their trading income to HMRC in the future at all. Others will be able to pay any tax they owe through a new simple online service. The changes reflect the government's commitment to driving forward efficiency reform, a key component of its Plan for Change.
Mr Murray, the minister responsible for HMRC, will announce this reform to tax experts hosted by the Chartered Institute of Taxation and the Institute of Chartered Accountants in England and Wales in a speech to mark the 20th anniversary of HMRC.
He will also detail future simplifications to the government's Temporary Admission customs procedure, to make this relief for temporary imports easier for a range of sectors to use, including art and antiques, often showcased in exhibitions across the UK.
A new digital pilot with the United States to test ways to speed up trade processes for U.S. and UK businesses is also expected to be announced. This pilot will look to make the communications between HMRC, the U.S. and businesses more seamless through better use of digital credentials and secure real-time data transfers. It will look to make it easier and quicker for businesses to request trade benefits from each country.
Minister Murray will also update on the work HMRC is doing to tackle phoenixism - where company directors go insolvent to avoid tax - as well as announcing a new reward scheme to encourage informants to come forward to HMRC about tax fraud.
Exchequer Secretary to the Treasury, James Murray said:
From trading old games to creating content on social media, we are changing the way HMRC works to make it easier for Brits to make the very most of their entrepreneurial spirit.
Taking hundreds of thousands of people out of filing tax returns means less time filling out forms and more time for them to grow their side-hustle.
We are going further and faster to overhaul the way HMRC works to make sure it delivers the Plan for Change that will help put more money in people's pockets.
Improving HMRC customer services
Since taking office, Murray has been taking teams of senior HMRC officials to meet firms including NatWest, Octopus Energy, Barclays, John Lewis, and Centrica to learn best practice and innovative approaches to modernising and digiting customer service from the private sector. This includes the use of generative AI and 'test and learn' approaches to improving customer service. HMRC is trialling the use of generative AI to point taxpayers to the advice they need on GOV.UK.
In line with practice from banks and other private sector businesses, Murray will announce that HMRC has begun trialling a system where customers can use their voice as their password, to pass security checks faster and more securely. Following an evaluation of the trial, it is expected to be rolled out across HMRC over the rest of this year. Voice Biometrics strengthen security, safeguard customer data, and reduce call times. Customers' voice recordings are converted into encrypted biometric data, a voice print, and stored securely in a data centre.
As reforms got underway to automate and digitise its services, HMRC met its target of 85 per cent of calls handled between October and December 2024 and is expected to meet its customer service standards in 2025-26.
As part of this government's commitment to partner and learn from industry, HMRC will launch a new service to provide an escalation route for agents with Self Assessment and PAYE queries which are over 4 weeks old. A dedicated team of experienced technicians and advisers will adopt a 'once and done' approach, taking end-to-end ownership of cases and maintaining regular communication with agents.
Closing the Tax Gap - phoenixism and informants
Since becoming chair of HMRC's board last year, Exchequer Secretary James Murray has steered the UK tax authority to go further and faster to close the tax gap, in order to raise the revenue required to fund public services and investment projects.
Following the Autumn Budget's announcement of future work to tackle phoenixism - where rogue directors avoid payment of company tax by going insolvent - Mr Murray will update on the work in his speech. He will lay out how HMRC and the Insolvency Service have agreed a joint plan, which includes an increase to the use of securities, where HMRC asks for upfront payment of tax from new companies, making more rogue directors personally liable for the taxes of their company.
Murray will also announce a new reward scheme for informants to be launched later this year. This will look to target serious non-compliance in large corporates, wealthy individuals, offshore and avoidance schemes. The scheme will take inspiration from the successful US and Canadian 'whistleblower' models and will complement the existing HMRC rewards scheme.
Informants could take home a significant amount of compensation. This will be equal to a proportion of the tax take, ensuring that the scheme raises more money that it costs. Work is ongoing within the government regarding what percentage this could be.
