HMRC’s Transformation Roadmap – a new direction for digital tax

On 21 July 2025, HMRC published its Transformation Roadmap, setting out its vision for a modern, digital-first tax and customs system. The roadmap outlines how HMRC plans to improve day-to-day performance for customers, close the tax gap, and reform the infrastructure of tax administration over the next five years and beyond. The key highlights from the roadmap are detailed below.

MTD for Corporation Tax scrapped

In a significant shift, HMRC has confirmed it will not proceed with Making Tax Digital for Corporation Tax. This decision reflects the complexity and diversity of the Corporation Tax population and the limited benefits of mandating digital reporting for all companies. Instead, HMRC will explore more targeted digital improvements for corporate taxpayers.

Digital-first by 2030

As trialled at the Spending Review in June, HMRC aims to become a digital-first organisation, with 90% of customer interactions taking place online by 2030. This figure currently stands at approximately 76%. To do this the functionality of the HMRC app and online accounts will be expanded, supported by AI-powered assistants and secure login systems. For example, a new online service for PAYE taxpayers will make it simpler and easier to check and update a taxpayer’s income, allowances, reliefs and expenses.

Customers and their agents will be able to track progress on enquiries, share documents with HMRC digitally and get personalised messages and guidance.

AI and data-driven compliance

As part of a broader strategy to reduce the tax gap, which stood at £46.8 billion in 2023/24, HMRC is investing heavily in IT infrastructure, AI and third-party data. For example, data will be used to pre-populate tax returns and deliver targeted data-drive nudges. Furthermore, HMRC is investing in AI-powered systems for caseworkers so they spend less time on administrative tasks and more time on their casework.

Adviser standards and registration

From 2026, tax advisers will be required to register with HMRC and meet minimum standards. This move aims to improve trust and transparency in the tax advice market. Draft legislation on improving tax adviser standards was released as part of Finance Bill 2025-26 also released on 21 July 2025.

The rise of e-invoicing

Following success stories in other jurisdictions, HMRC is working with the Department for Business and Trade on introducing automation of the invoicing process with the stated benefits of saving time, reducing errors and improving cash flows.

What this means for businesses and advisers

The roadmap signals a more pragmatic and focused approach to digital transformation but, as always, the proof will be in the delivery.

Read the full roadmap on GOV.UK