HMRC's digital push has reached unprecedented levels, with a staggering 5.6 million individuals checking their pay through its app an average of 18 times annually, translating to a total of 100 million checks last year. This figure is a direct result of the HMRC's ambitious Transformation Roadmap Update, aimed at modernising the tax system and making it simpler, faster, and more convenient for taxpayers.
The HMRC app has experienced remarkable growth, attracting 7.6 million unique users in the 2025-26 period, representing a 28% increase from the previous year. This momentum is set to continue, with HMRC targeting 10 million users by April 2027, underscoring its commitment to a 'digital-first' approach. The app offers a range of services, including pay verification, National Insurance number checks, tax code reviews, income and benefits tracking, as well as Self Assessment payments and correspondence management.
As part of this digital overhaul, HMRC is actively phasing out outdated communication methods, with the department reducing letters sent to customers by 15 million over the past three years. Average call waiting times have almost halved in the last two years, now standing at approximately 12.5 minutes. The Exchequer Secretary to the Treasury, Dan Tomlinson MP, recently confirmed that from summer 2027, over 100 personal tax letters will become available digitally for the first time, reducing postal reliance.
HMRC's long-term strategy includes a commitment to reduce postal letters by up to 75% by the 2028-29 financial year. This initiative is projected to generate annual savings of £50 million, providing a more efficient and environmentally friendly way for customers to manage their tax affairs. The transformation also encompasses broader reforms, such as the initial phase of Making Tax Digital (MTD) for Income Tax, launched in April 2026, for sole traders and landlords with qualifying incomes exceeding £50,000. Over 350,000 individuals have already signed up for this significant change, which marks the most substantial alteration to how many customers engage with the tax system in three decades.
The economic implications of this digital shift are noteworthy. For UK businesses, particularly sole traders and landlords, the MTD initiative is expected to streamline record-keeping, with businesses already utilising MTD for VAT reporting average administrative time savings of 26 to 40 hours per year. While the direct impact on FTSE 100 companies is less immediate, the broader move towards digital efficiency within the tax system could contribute to overall economic productivity and reduce administrative burdens.