In a bid to improve relations between HM Revenue & Customs and taxpayers, HMRC is set to trial the idea of sending HMRC ‘thank you’ letters to businesses that pay their taxes on time. According to National Audit Office reports, customer service levels at HMRC in 2014/15 fell dramatically as up to 5,600 employees left the organisation. As a result, service levels plummeted to a point where some taxpayers had to wait up to 47 minutes for their phone calls to be answered.

HMRC’s cost cutting exercise saw staff numbers slashed by 42 percent, with 55 percent of those employees leaving due to ‘natural wastage’. This included 2,500 staff who took voluntary redundancy and others who were redeployed elsewhere in the organisation.

Concerted attempts at cost cutting

HMRC is committed to cutting costs by 34 percent by 2020 with a number of staffing changes that are due to be phased in over the next five years. HMRC has been relocating staff to centralised call centres in a bid to reduce its costs, but many employees are reluctant to make the move. The result has been the loss of many skilled and experienced workers.

There are also a large number of workers on older contracts who are not contracted to work evenings and weekends. These are increasingly the periods when taxpayers want to contact HMRC, but many HMRC employees are not willing to work during these times.

Customer service performance has been ‘below standard’

Speaking on behalf of HMRC, new chief executive Jon Thompson, said he “absolutely agreed” that the organisation’s level of customer service performance had been below an acceptable standard in 2014/2015. He also said he was committed to making improvements.

As part of these improvements, HMRC is now sending information to taxpayers to tell them how their tax money has been spent. While the MPs on the Public Accounts Committee welcomed this development, the idea of sending thank you letters was also raised.

Caroline Flint, the MP for Don Valley, said that although the decision to send information to taxpayers about where their money was spent was a good one, she preferred a recent idea introduced in Australia. All Australian taxpayers are sent letters which begin: “Dear Citizen, the Australian government thanks you for your tax contribution.” In response to Ms Flint’s suggestion, the HMRC chief executive said the organisation was already trialling this new approach.

Taxpayers spend four million hours on hold

Company directors who have tried contacting HMRC in the past will know just how difficult it can be to speak to someone without spending a long time on hold. A National Audit Office report found one-in-five callers last year hung up after waiting on line for an average of 16 minutes each.

In 2014/15, it was also calculated that taxpayers were on hold for a total of more than four million hours. Incredibly, this meant that HMRC’s holding music came second in the list of the year’s most streamed music. The National Audit Office also calculated that for every £1 poor customer service cost HMRC, the cost to the taxpayer was £4.

Dealing with HMRC on your behalf

If you’re struggling to pay your VAT, PAYE or corporation on time, or you’d like to negotiate a Time to Pay Arrangement with HMRC, we can help. We have years of experience working with HMRC on behalf of our clients and have achieved two substantial settlements in the last few months.

If you’re struggling to make HMRC payments, contact us today for advice on the more serious stages of HMRC threats and the help and support you need to help resolve the situation.