HMRC is set to eliminate paper letters for millions of taxpayers starting in April of next year. This move follows the tax office’s strategy to transition to a “digital by default” approach, with the aim of saving £50 million annually by 2028/29.
In the recent Budget announcement, it was confirmed that the gradual phasing out of paper communications will commence in April 2026. Going forward, taxpayers will receive digital letters through their HMRC online account or the HMRC app. However, households without internet access or facing challenges with digital services will still receive written correspondence, and HMRC’s phone lines will remain operational.
Taxpayers who already utilize the HMRC app, online Personal Tax Account (PTA), or Business Tax Account (BTA) will be the initial groups affected. Additionally, individuals will have the option to continue receiving paper letters if preferred.
HMRC will prompt individuals to verify their contact details when the transition begins. The tax office sends letters for various reasons, such as notifying about tax code changes or the requirement to register for self-assessment.
In a separate update, HMRC disclosed that over 200,000 letters have been issued to sole traders and landlords with qualifying income exceeding £50,000. These individuals will soon be mandated to submit quarterly updates using HMRC-approved software if their turnover surpasses £50,000 from self-employment or property income.
While the rollout is scheduled for April 2026, HMRC encourages early preparation for the impending changes. Taxpayers will need appropriate software, which can be obtained through free or paid options. The software will provide real-time tax estimates throughout the year, aiding in cash flow planning and preventing surprises during tax season.
Craig Ogilvie, Making Tax Digital director, emphasized the importance of preparing for the upcoming tax changes. He highlighted the benefits of spreading tax administration tasks throughout the year, as opposed to rushing during the Self Assessment period in January. Early feedback on the new system indicates user-friendliness, with free software options available for taxpayers.
Overall, HMRC aims to streamline tax processes and enhance digital services for taxpayers while providing support and guidance during the transition period.