Improving the data HMRC collects from its customers: a consultation response
28 April 2023
As part of the flurry of documents released on Tax Administration and Maintenance Day, held on 27 April 2023, HM Revenue and Customs(HMRC) published its response to the consultation: Improving the data HMRC collects from its customers.
The consultation explored several potential areas in which HMRC could improve the range of data it collects and uses. Of note for payroll professionals, there was discussion of the collection of:
- occupational data to understand the skills the government should focus on to best support employees and employers. This would include the collection of more information regarding the occupations of employees, via an additional field which would be included on real time information (RTI)
- the office location or normal work base of employees, to highlight to HMRC where economic activity is high, and to highlight the split of activity between a business’s locations. Again, this would be recorded via new fields on RTI
- more detailed information on employee hours worked. Instead of selecting from the range of bands A-D for hours worked, as currently shown on RTI, numerical hours would be input. Category E is used for workers on zero hours contracts or irregular working hours at present, but this would be expanded to provide details regarding the reasons for the irregularity of hours worked.
There’s also detailed discussion of how additional data could be collected across the self-employed population, but we, as the CIPP, focussed on the elements impacting employees paid via payroll.
The consultation response document confirms that the government will proceed with collecting improved data on employee hours worked. Contractual hours worked will need to be provided where those hours are regular (i.e., not irregular hours or zero hours) and actual hours worked will need to be recorded for hourly rate employees (this will be proportionate and shouldn’t case additional administrative burden). HMRC has committed to working alongside businesses and software providers to allow sufficient time for the changes to be implemented successfully and to consider any challenges that may arise from the new requirements.
The response document also states there’ll be no further collection of data relating to sector, occupation or location. This is due to the concerns and challenges raised by respondents to the consultation, which centre on the extra administrative burdens this could place on organisations.
The CIPP responded to this consultation, and the response document can be located here.
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