At Autumn Budget 2025, the government announced more timely payments for Income Tax Self Assessment and committed to developing the policy with stakeholders through a public consultation. The consultation closed on 4th August 2026 and responses are being analysed.

The Budget 2025 announcement followed the usual tax policy-making process, including consideration of impacts on customers with variable incomes.

The government is carefully analysing consultation responses and any potential safeguards to ensure appropriate support is available for affected customers.

Future impacting based on the evidence of the consultation will be carried out by the government as usual as part of any future Budget announcements.

The government has worked closely with the software industry to ensure the availability of a broad range of MTD-compatible products to suit different needs and budgets.

This includes free products supporting those with the simplest affairs, low-cost bridging software for those who prefer to continue using spreadsheets and more sophisticated products that integrate with other business software.

Currently, there are more than 20 free products (excluding free trials) covering a range of different scenarios including bookkeeping, quarterly updates and end-of-year submissions

HMRC is not providing its own MTD solution because commercial software providers are better positioned to be able to provide a broad range of products to meet the diverse needs of businesses and landlords.

HMRC’s correspondence service standard is to respond to 80% of priority post, including repayment claims, within 15 working days.

Regular HMRC performance information, including progress against this correspondence service standard, is published at https://www.gov.uk/government/collections/hmrc-quarterly-performance-updates

HMRC does not hold this information in a readily accessible format. The information requested could only be obtained through the manual review of individual records, and the cost of doing so would exceed the disproportionate cost threshold.

The Government is committed to helping taxpayers get their tax right. While the use of external Large Language Models can be helpful, they may not always provide accurate tax advice and HMRC has no control over the way these models are trained. HMRC therefore encourages customers and agents to use official guidance and services on GOV.UK when meeting their tax obligations.

This includes GOV.UK Chat an AI-powered chatbot which uses a Large Language Model within guardrails developed by HMRC and DSIT/GDS. There is evidence that the GOV.UK chatbot’s responses are robust, as evidenced by a recent article in the Daily Telegraph, which chronicled a journalist using an adversarial line of questioning, who still received accurate replies.

HMRC also works closely with software developers and industry partners to promote the responsible use of AI, helping reduce the risk of errors and supporting customers to meet their tax obligations with confidence.

HMRC offers a wide range of support to help customers complete their Self Assessment return. This includes support through their helpline, guidance notes and help sheets on GOV.UK, as well as online webinars and recorded videos on YouTube covering various Self Assessment scenarios.

HMRC monitor the effectiveness of their communications and assess how easy it is for customers to deal with the department through customer feedback. They publish regular data on customer service performance, including telephony performance, on GOV.UK.

https://www.gov.uk/government/collections/hmrc-quarterly-performance-updates

HMRC provides a range of ways for customers to complete their Self Assessment tax returns. While the majority of customers now file online, paper tax returns remain available for those who cannot or prefer not to use digital services.

Customers who filed a paper return in a previous year are automatically issued with a paper return for the following year. Those who have not previously filed on paper can download the relevant forms from GOV.UK or request a copy from HMRC.

At Autumn Budget 2025, the government announced more timely payments for Income Tax Self Assessment and committed to developing the policy with stakeholders through a public consultation. The consultation is now live on www.gov.uk and will close on 4 August 2026.

The government recognises that Self Assessment taxpayers may have seasonal or irregular income patterns and is carefully considering as part of the consultation process how to support such customers. The government welcomes responses from those who may be affected, which will inform the final policy design.

HMRC has been accepting applications for exemption from Making Tax Digital (MTD) for Income Tax since September 2025.

Around 6,500 applications for exemption have been received to date. Decisions have been reached on around 60% of these cases, with approximately 75% of the determined applications granted exemptions based on the specific circumstances of each taxpayer.

Taxpayers may request a review or appeal decisions using established processes, with a very small number proceeding to appeal.

Eligibility is assessed on a case-by-case basis, including factors such as age, disability, health conditions, religious beliefs or lack of internet access; HMRC does not produce a single estimate of the number of those who may qualify.

In January 2026 HMRC had 15 FTE focused on exemptions. This increased to 42 in June 2026.

HMRC provides guidance and communications directly to taxpayers and works with agents, charities and representative bodies to help raise awareness of exemptions. Taxpayers who cannot use digital services can meet their obligations through alternative channels, mitigating the risk of inappropriate penalties.

The Government keeps the operation of MTD under review, including exemptions. Decisions on publishing further statistics in relation to MTD will be considered alongside wider transparency arrangements.

HMRC has been accepting applications for exemption from Making Tax Digital (MTD) for Income Tax since September 2025.

Around 6,500 applications for exemption have been received to date. Decisions have been reached on around 60% of these cases, with approximately 75% of the determined applications granted exemptions based on the specific circumstances of each taxpayer.

Taxpayers may request a review or appeal decisions using established processes, with a very small number proceeding to appeal.

Eligibility is assessed on a case-by-case basis, including factors such as age, disability, health conditions, religious beliefs or lack of internet access; HMRC does not produce a single estimate of the number of those who may qualify.

In January 2026 HMRC had 15 FTE focused on exemptions. This increased to 42 in June 2026.

HMRC provides guidance and communications directly to taxpayers and works with agents, charities and representative bodies to help raise awareness of exemptions. Taxpayers who cannot use digital services can meet their obligations through alternative channels, mitigating the risk of inappropriate penalties.

The Government keeps the operation of MTD under review, including exemptions. Decisions on publishing further statistics in relation to MTD will be considered alongside wider transparency arrangements.

HMRC are taking a digital-first approach to improving the experience for their customers, providing more digital and online services.

People with lasting power of attorney (LPA) are able to file online Self Assessment returns using the HMRC free online service, as long as they can provide the relevant verification documents. This approach ensures HMRC can verify the identity of the individual and safeguard potentially vulnerable customers.

I refer the honourable member to the answer provided in the response to 122373. (5601)

I refer the honourable member to the answer provided in the response to 123012. (5602)

The National Infrastructure and Service Transformation Authority (NISTA) is expected to publish the annual Government Major Projects Portfolio (GMPP) transparency data on GOV.UK in July, which will include updated information on programme costs and benefits.

Costs will differ from business to business and are influenced by factors including size and complexity of the business, degree of digital capability and cost and functionality of chosen software.

HMRC has published assessment of the potential impact of MTD for Income Tax on taxpayers joining from April 2028, and it is available at:

www.gov.uk/government/publications/making-tax-digital-for-income-tax-self-assessment-reducing-the-mandation-threshold-from-30000-to-20000-from-april-2028/reduction-of-the-mandation-threshold-from-30000-to-20000-from-april-2028

The government has worked closely with the software industry to ensure the availability of a broad range of MTD-compatible products to suit different needs and budgets.

This includes free products supporting those with the simplest affairs, low-cost bridging software for those who prefer to continue using spreadsheets and more sophisticated products that integrate with other business software.

Currently, there are more than 20 free products (excluding free trials) covering a range of different scenarios including bookkeeping, quarterly updates and end-of-year submissions.

HMRC is not providing its own MTD solution because commercial software providers are able to provide a broad range of products to meet the differing needs of businesses and landlords, in a way that HMRC is not.

As part of the Making Tax Digital (MTD) for Income Tax awareness campaign, HMRC issued letters to customers with qualifying income over £50,000. These customers were identified based upon the latest information held by HMRC at that time.

While some customers may subsequently have fallen below the threshold due to amendments to their 2024/25 tax returns made after letters were scheduled, HMRC is satisfied that the correct customers have been contacted overall and does not consider that any significant additional mailing or administration costs were incurred.

Returns will be published in due course.