As part of its recently launched ‘Digital Strategy’, HMRC plans to upgrade its Self Assessment arm to make all communications with taxpayers paperless in the near future.
Of all the SA returns which were filed for the 2011-12 tax year, just over 80% of taxpayers used the online submission service (7.5m), however it is estimated that a mere quarter of all self-assessment related communications between the taxman and taxpayers are conducted online.
In a recently published consultation document, HMRC has outlined its plans to create a ‘paperless’ self assessment system, which would mean that all SA-related information is sent electronically rather than via post.
Typical communications would include statutory notices, reminders and self assessment statements. These will all become viewable from the individual’s online account if the proposals go ahead.
Some of the most common types of letter / notice currently include:
- Notice for a taxpayer to complete a tax return.
- Penalty notices when returns have not been submitted by the due date, or errors have been made.
If you opt in to the new service, HMRC will send you a message each time something is sent to your online account. Official communications including reminders and statutory notices will have the same legal validity as those currently sent via traditional mail.
In order to implement this upgrade, a change in the law is required, and HMRC hopes to launch a trial service from April 2014.
According to the consultation document, specific types of communication will be upgraded to paperless as part of a staged approach, according to when each service can be delivered securely, rather than attempting to upgrade the entire system at once (surely a recipe for disaster as the recent RTI implementation demonstrated).
Presumably, assuming this move to paperless self assessment is successful, the Government may consider implementing similar systems for companies both for Companies House communications and those between employers and HMRC.
The Government claims that it can save up to £200m per year if an additional 29 million transactions were moved online. This is the main objective behind its Digital Strategy, which was unveiled last December.
The consultation period ends later this month. You can find out more details via GOV.UK here.
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