After a consultation with HMRC, paperless self-assessment could be on the way. Which is all very well… but unless they simplify the system and make it plainer, will it really make much difference to taxpayers?

Apparently there are already more than 10 million self-assessment taxpayers, most of whom already file their tax online. But only a quarter of HMRC communications can currently be dealt with over the web. A paperless self-assessment system means HMRC will contact us via email and other electronic means rather than in writing the old fashioned way.

Faster and simpler? Or just electronic?

The Exchequer secretary to the Treasury, David Gauke, feels that the HMRC’s digital strategy will “make processes like self-assessment faster and simpler” and “deliver the tax system for the 21st century that taxpayers expect.” All of which is fair enough. But the system is still far too complex for many people, and taking it online won’t make its intricacies any easier to grasp.

Awards for simplifying the system

At the same time, early December saw HMRC presenting awards to a bunch of folk who had worked hard to make the British tax system simpler and more transparent. Congratulations to the winners… but in the opinion of many people there’s a long, long way to go before self-assessment is genuinely accessible to everyone, easy to understand, straightforward and simple.

As David Gauke said to Accountancy Age, “There is some excellent work going on between HMRC and the tax community. By listening to and working with tax professionals HMRC can make the tax system in the UK as simple and transparent as possible.”

Would ‘outsiders’ make a better job of it? 

If the tax system was already genuinely simple, millions more ordinary self-employed people might be able to do their own tax returns instead of paying an accountant. So what’s the solution? How about farming the simplification task out to people who don’t work in HMRC, people who don’t have any preconceptions or prior knowledge?

Would outsiders be better equipped to spot where the system doesn’t make sense, is too complicated or could be improved? Will relying on HMRC insiders and people who already have an in-depth existing understanding of the system ever result in a genuinely simple and easy-to-understand system? What do you think?