HMRC Using Digital Prompts To Reduce Mistakes

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February 28th 2024
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HMRC Using Digital Prompts To Reduce Mistakes

Taxman using past income data and earnings data from external sources to make sure submissions are correct.

HMRC is leveraging new technology to use more personalised 'intelligent' prompts, drawing from a variety of data sources to help taxpayers accurately file their tax returns.

The Digital Prompts Program aims to decrease tax mistakes made by customers submitting tax returns by showing warnings as customers make submissions.

Research was commissioned that involved in-depth interviews with customers who completed an online Income Tax Self Assessment and centered on landlords, those with unearned income, micro-businesses, and gig economy workers.

According to the research conducted on the efficacy of the program, taxpayers provided the feature found basic prompts too generic and did not believe they encouraged positive behaviour such as double-checking or accurately completing returns.

Though Taxpayers were happy that source prompts, which let them know that HMRC is getting data from specific platforms they use, such as online sales platforms, they were not happy that transaction prompts that were using the third-party external data presented precise earnings in an unfairly accusatory tone.

The researchers stated this and could cause negative actions, such as deliberate under-reporting and reputational harm to HMRC and the tone should be helpful rather than accusatory.

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