Digital by Default – The Story so far and Next Steps, and AAM Update

1. 12.40 - 12.40 Digital by Default – The Story so far and Next Steps, and AAM Update • Julian Hatt, John McRae • Head of Customer Understanding and AAM, HMRC • www.ifa.org.uk

2. HMRC: Digital by DefaultThe story so far and next steps Julian Hatt – Head of Customer Engagement John McRae – Agent Account Manager

3. Running Order • ‘Hot Topics’ for Agents and HMRC John 15 mins • Digital by Default – Recap & Update Julian 15 mins • Questions and (if you’re lucky!) Answers All 10 mins

4. Agent Account Manager Service 10,000 tax professionals are signed up for this service Over 2,500 client specific issues facilitated Top 5 issues Repayment delays – Ltd Companies / Self Assessment and PAYE 64-8 UTR RTI Online services

5. Digital by Default

6. Digital by Default • Digital services are so straightforward and convenient that all those who can use them will use them, whilst those who can’t will not be excluded • ‘Revolution not Evolution’ (Martha Lane Fox’s 2010 report) • Substantial investment in HMRC’s digital services: +£200m in Budget 2013 • External pressure (Office for Tax Simplification, Administrative Burdens Advisory Board, business, tax profession) to make things quicker, easier and simpler for SMEs 6

7. Digital Strategy

8. Supporting our Customer Centric Strategy It drives revenue –digital by default services will allow us better to target interventions and manage risk on a transaction by transaction basis Shifting more contact to digital channels contributes significantly to each of HMRC’s strategic objectives. It’s cheaper – self serve allows us to theoretically shift to a ‘frictionless’ relationship, or at least towards cheaper channels. It’s better for customers – a true digital interaction is quicker, easier, and comparable with external experiences. Allows us to quickly target and segment – broadens our ability to deliver services by segment & influence behaviours (“nudge”) 8

9. Facts ‘n’ Figures 82%

10. Facts ‘n’ Figures 28%

11. Facts ‘n’ Figures 650

12. How are we doing it Focus is on user needs rather than traditional requirements Delivery is iterative (start small and grow) rather than agreeing all the detail upfront Regular user testing throughout to inform development and design Ongoing improvement and iteration of the service Delivered via more flexible design/delivery process – Agile

13. How are we doing it User Needs Cost:Benefit Speed of Delivery 13

14. The 4 Digital Exemplars 14

15. Your Tax Account and Digital SA

16. Digital Self Assessment - Background Self Assessment is one of our flagship online services 80% of our customers choose to file online Only 25% of customer self assessment journey takes place online We send customers letters at every stage of the process Despite filing with us online… We use paper to tell customers the outcome of their filing! This is confusing and drives low-value contact at our contact centres 600k calls asking about repayments 183k letters asking about letters 16

17. What are we doing Can access all the help they need via links to… …tailored education… …and interactive tools taking them straight to the relevant information for them Can see an overview of their HMRC “account”… Via their personalised homepage small business users … …with links straight to action they need to take… …help finding the right payment plan… Can get the answers to their questions quickly and easily …and a personalised tax calendar with digital alerts …as well as receiving tailored outbound communications from HMRC Can get direct access to all the online transactions relevant to them… …and receiving relevantkey messages from HMRC (and potentially other Government Departments) direct to their homepage …without having to wade through content that isn’t relevant to them 17

18. Your Tax AccountSequencing 750 volunteered for a 2 month trial of the Private Beta service– not all used it Feedback mechanisms were in place – both in-service and ‘exit survey’ A pan-exemplar customer support model was also evaluated during the trial Public Beta started on 7 April 2014 Not yet widely accessible Controlled ‘rollout’ – HMRC able to throttle take-up dependent on performance Can revert to existing [HMRC portal] access if necessary ‘Skin & Link’ Continual development of the service – new features and functions 18

33. PAYE for Employees

34. PAYE Online The first online service for 41 million individuals within PAYE 60 million calls, annually, to HMRC’s contact centres 13.9m PAYE-related 4-5m of these are to query tax code 16% of these relate to car / van, fuel and medical benefits Costing customers £5 per call and HMRC £6 per call (longer calls) A Private Beta underway with changes to car / van benefits and bank interest Shift balance of the relationship away from the employer and on to HMRC Currently forecasting that PAYE calls will reduce by 1.7m [12%] 34

40. Agent Online Self-Serve [AOSS]

41. Agents – Setting the scene At least 8m customers use an agent to represent them Customers choose an agent for a variety of reasons The majority use an agent for profit taxes Customers look to agents to ensure they pay the right tax at the right time

42. Our aim Agents will be able to: Register with us digitally Notify us of clients digitally View clients’ data online Use digital services on behalf of clients More to come

43. Agents on the digital agenda We have ambitious digital plans that mean we need to: Have a single view of agents and their clients – and recognise this relationship across tax regimes/services Reduce exposure to cyber crime by bogus agents Move agents away from using paper Enable an authorised agent to see and do digitally the same as their clients

44. Identity Assurance [IdA] • A pan-government project led by Cabinet Office • A model for trust and security • A process for providing individuals with credentials that allow them to prove that they are who they say they are (when online)

45. People perform different roles • Individual managing their own tax affairs • Responsible officer managing tax affairs of a limited company or partnership • Employee managing the tax affairs of a business entity • Self-employed (sole trader) agent managing the tax affairs of a client • individual, limited company or partnership) • Employee in an agent organisation managing the tax affairs of a client entity • Friends and family (unpaid) • Others

46. Authority Management Service • A service which allows people to interact with government services on behalf of other people or organisations • IdA for Organisations and Agents • A process providing online credentials for all levels of responsibility to prove permission is held to act on behalf of an organisation • Discovery phase has been completed • Mid-way through research and development of an Alpha prototype

47. ‘Discovery’ for IdA - Users told us • Solutions need to be easy and carry perceived benefits • Personal and work identities need to be separate • Large organisations will need scalable solutions • Credentials need to be tied to the firm – not to employees • Delegation needs to reflect the different roles and responsibilities within an • organisation • Do not create additional work for our customers

48. Delivering the new services • Will depend upon Identity Assurance and Authority Management solutions for citizens, businesses and agents • Authority Management allows IdA credential holders to delegate permissions • We are working closely with GDS to ensure HMRC’s new digital services and IdA: Authority Management credentials are carefully integrated • Next step – continue to user test and develop the initial (Alpha) products • Aiming for private beta – Oct to Dec 2014

49. Workstrands • Friends & family agents • delegation of authority to the friend or family member • Organisations & agents in business • more complex needs for delegating permissions in-house and to third parties • Third party software • most businesses and agents use in-house or third party products to • govern access to services & customer records • Existing agent / client relationships • we want to: • transfer these to the new services where we can • find the least burdensome way to do this • it will not be possible in all cases

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