HMRC Needs to Change - Video Insight
HMRC Needs to Change - Video Insight
Damien Talks Money
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The video critiques HMRC's inefficiencies and outdated systems while urging viewers to maximize their tax claims and responsibilities.

The video discusses the inefficiencies and outdated practices of HMRC (Her Majesty's Revenue and Customs) in the UK tax system that cost the public billions annually. The speaker humorously highlights absurd excuses from taxpayers for late submissions while critiquing the systemic failures in technology, communication, and overall taxpayer education, which have created barriers for individuals trying to navigate their tax obligations. Additionally, the video covers the impacts of a stubbornly antiquated payment system involving checks, unclaimed tax relief, and encourages viewers to take proactive steps to ensure they are informed and maximizing their tax claims.


Content rate: A

The content provides a well-rounded critique of HMRC and the UK tax system, supported by statistical data and practical advice for viewers. It effectively informs and educates about systemic failures and encourages proactive actions to claim benefits, making it highly useful for the audience.

tax HMRC finance technology education

Claims:

Claim: The use of checks impacts the tax payment system negatively.

Evidence: In 2022, HMRC sent out 5 million checks, with 615,386 uncashed, totaling around £217 million.

Counter evidence: Checks are still preferred by some, particularly older individuals, who are comfortable with this form of payment.

Claim rating: 8 / 10

Claim: HMRC's phone support system has a high abandonment rate.

Evidence: In January last year, 800,000 out of 3.7 million calls were abandoned, often due to excessive wait times.

Counter evidence: Some taxpayers might not need assistance and could be filing their taxes online, reducing call volume.

Claim rating: 9 / 10

Claim: People are leaving billions unclaimed due to a lack of information.

Evidence: An estimated £1.3 billion was left unclaimed from higher rate tax relief between 2016 and 2021.

Counter evidence: Some taxpayers might not be aware of their eligibility for certain claims, leading to less engagement.

Claim rating: 7 / 10

Model version: 0.25 ,chatGPT:gpt-4o-mini-2024-07-18

### Key Facts from the Transcript on UK Tax System and HMRC 1. **HMRC's 2014 Excuses List**: In 2014, HMRC released a list of genuine excuses given for late tax returns, including a goldfish dying and having a bad back preventing access to the tax return. 2. **Challenging Tax System**: The UK's tax system is criticized for being outdated, overly complex, and not keeping pace with modern technology, leading to billions in unclaimed refunds and allowances. 3. **Check Payments Declining**: Checks are becoming less common; the number issues dropped from 1.6 billion in 2006 to 150 million in 2021. HMRC issued 5 million checks in 2022, with around £217 million left uncashed. 4. **Claims Process**: As of mid-2024, HMRC changed the claim process for refunds, requiring taxpayers to actively claim their refunds rather than automatically receiving checks, raising concerns about accessibility. 5. **HMRC Call Challenges**: In January 2022, 800,000 calls to HMRC were abandoned due to long wait times, with the line disconnecting after 70 minutes. 6. **Late Payment Fines**: Late tax payments incur fines, starting with an initial £100 penalty and escalating to higher amounts based on the delay, with totals nearing £188 million in fines during a specified period. 7. **Interest Rates**: HMRC charges higher interest (7.25%) for late payments compared to the interest (3.75%) returned on overpayments, raising fairness concerns. 8. **Tax Code Awareness**: 18% of adults have never checked their tax code, and 31% of those who do find errors, often resulting in overpayments. 9. **Unclaimed Allowances**: Various tax benefits are underclaimed, including: - **Marriage Allowance**: £2.4 billion unclaimed. - **Universal Credit**: £7.5 billion unclaimed. - Child Trust Funds: £1.7 billion unclaimed. - Working Tax Credits: £2.5 billion unclaimed. 10. **Information Accessibility**: The HMRC guide on filling out a self-assessment is excessively long (over 25,900 words), discouraging engagement from individuals unfamiliar with the process. 11. **Legacy Systems**: The analogy between outdated HMRC processes and legacy technologies, like the QWERTY keyboard, was drawn, suggesting institutional inertia affects efficiency and user experience. 12. **Awareness and Action Needed**: Taxpayers are encouraged to stay informed about their tax obligations, check their tax codes, and claim all eligible allowances to avoid leaving money unclaimed. Remember to actively check tax codes and claim available funds to maximize financial returns in the face of systemic inefficiencies.