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hmrc covid impact annual report
November 15, 2021, admin

COVID’s impact dominates the HMRC’s yearly report

HMRC’s annual report for 2020-21 indicates that the pandemic has damaged not only its day-to-day operations, tax revenues, and customer service, but also has the potential to jeopardise the implementation of the new plastic packaging tax and the updating of HMRC’s telephonic services. The Tax Faculty summarises the important points.

Unsurprisingly, the study concentrates on HMRC’s response to the COVID-19 pandemic, including the implementation of government financial support packages and a variety of additional measures, such as payment deferrals, while also managing the end of the UK’s EU exit transition.

HMRC collected £608.8 billion in total tax receipts in 2018, which was less than the £636.7 billion collected in 2019/2020. The VAT (-11%), hydrocarbon taxes (-22%), stamp taxes (-18%), and air passenger fee (-11%) were the most noticeable cuts (-91 percent ).

At the end of March 2021, debt held was £57.5 billion, up from roughly £35 billion the previous year but down from the peak of £70.2 billion during the pandemic.

The compliance yield decreased to £30.4 billion from £36.9 billion the previous year. The report emphasises that compliance efforts during the epidemic were primarily focused on averting criminal attacks.

The research highlighted the growing importance of digital prompts, which generated £147.2 million in revenue; examples include prompts inside HMRC’s online self-assessment return and charity gift aid payback requests.

Additionally, the annual report exposes a significant amount of fraud in connection with the government’s COVID-19 support programmes. It believes that fraudulent and erroneous claims might total £5.8 billion.

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