This week's opinion: 8 October 2020

What responsibility should HMRC have for informing people about their tax obligations, in particular when something new is introduced? The question is prompted by two HMRC reports – one on the high income child benefit charge (tinyurl.com/foihicbcsep) and the other on reporting by employment intermediaries (tinyurl.com/hmrcueirsep). Although these are different topics they are linked by a common thread – non-compliance with new rules because of a lack of knowledge. There are cases when people know about new obligations but choose to ignore them, but these reports suggest that when people do know about an obligation they will comply. 

How should HMRC get the message across? Is it obliged to do so? One view, perhaps old fashioned, is that citizens in a democracy should inform themselves about their obligations. Most people would, however, consider that the state should help citizens to understand their obligations. Tribunals’ approaches to reasonable excuse in high income child benefit charge cases suggest there is no consensus. What role should agents play in communication? One of the striking things in the intermediaries report is the number of businesses saying that their agent had not told them about their obligations. Perhaps they filed the information and forgot about it... 

There is no easy answer. Information overload is almost as bad as no communication. A proper digital strategy may enable better communication between taxpayers and HMRC. I would certainly like to see this aspect given greater emphasis as making tax digital develops.