HMRC's £2M Property Snooping Exercise

 

HMRC's £2 million property snooping exercise: An expensive exercise in futility that won't work

When did owning your own home become an invitation for the taxman to start photographing your garden, scrutinising your windows and peering over your property in the hope of finding another few thousand pounds to extract from you?

HMRC's latest property-tax initiative is an extraordinary example of a government confusing surveillance with sensible tax policy.

The proposal to send valuation inspectors to investigate homes worth around £2 million or more, photograph properties and gather information about their physical characteristics is being presented as a way of making the tax system fairer.

But there is a rather obvious problem.

You cannot accurately establish the market value of a property simply by photographing it, counting its bedrooms or inspecting its garden.

And the more HMRC tries to turn this into a rigid inspection exercise, the more expensive, contentious, subjective and administratively unworkable it is likely to become.

This is not a serious solution to Britain's broken property-tax system. It is another layer of bureaucracy being bolted onto a system that desperately needs fundamental reform.

The property police are coming – but what exactly do they think they will discover?

The proposed High Value Council Tax Surcharge, due to come into effect in April 2028, will impose additional annual charges on properties valued at £2 million and above.

The proposed charges range from £2,500 to £7,500 a year, depending on the valuation band.

The Valuation Office Agency, which operates within HMRC, is expected to undertake the valuation exercise.

Now we learn that inspectors are being instructed to photograph homes and gardens, collect information about property characteristics and potentially seek access to interiors.

Photographs taken from public highways do not require the homeowner's permission. Photographing from within private property does require permission.

The obvious question is: what does any of this actually prove?

A photograph of a £2 million house does not establish that it is worth £2 million. A photograph of a swimming pool does not establish that it adds a particular amount to the property's market value. And a picture of an impressive garden tells us absolutely nothing about what a willing buyer would actually pay.

The distinction between a property's appearance and its market value seems to have been lost somewhere in Whitehall.

1. Property valuation is not a photographic exercise

This is where the whole idea begins to fall apart.

Property valuation is a professional discipline, not a photographic guessing game.

Two houses can look almost identical from the road and have dramatically different market values.

Consider the things a photograph cannot reliably establish:

• The condition of the roof, foundations, wiring and plumbing.

• The quality of internal renovations and workmanship.

• Whether an extension has the necessary planning and building regulation approvals.

• Whether the property suffers from damp, structural movement or subsidence.

• The quality of the interior finish.

• The condition and accessibility of the grounds.

• Whether the property has restrictive covenants, rights of way or other legal complications.

• The actual demand from buyers in that particular location.

A beautiful Georgian property might look magnificent from the street but require £500,000 of structural work.

A comparatively unremarkable house might have been comprehensively renovated internally and command a substantial premium.

Which one is worth more?

HMRC cannot photograph its way to the answer.

2. The £2 million threshold creates an enormous valuation headache

Perhaps the biggest weakness is the arbitrary financial threshold.

A property valued at £1.99 million potentially escapes the surcharge. A property valued at £2.01 million attracts an additional annual tax bill.

Yet the difference between those valuations could be nothing more than professional judgement.

Property is not a commodity with a fixed market price.

It is not like weighing gold or measuring electricity consumption.

There are relatively few genuinely comparable transactions for many expensive properties. Some may not have sold for years. Others may be unique buildings with unusual layouts, substantial grounds or historical features.

Even experienced RICS-qualified surveyors can disagree about the market value of an individual property.

If two professional valuers cannot agree, what makes anyone think an HMRC inspection team armed with a camera and a checklist will produce an indisputable answer?

The government is creating a tax system in which a valuation disagreement of a relatively small amount could trigger thousands of pounds in additional annual liability.

That is an invitation to disputes.

3. Britain's property market does not stand still

Another fundamental problem is the assumption that a property valuation remains meaningful for years.

It doesn't.

Property values fluctuate according to:

• Interest rates.

• Mortgage availability.

• Local employment conditions.

• Changes in demand.

• Planning decisions.

• Infrastructure investment.

• Economic confidence.

• Changes in the local housing market.

A property worth £2.1 million today might be worth £1.85 million in a deteriorating market.

Conversely, a property currently valued below £2 million could cross the threshold following a period of strong market growth.

A photograph cannot predict the housing market.

And if valuations are only refreshed periodically, the government risks collecting tax based on figures that bear little relationship to what properties would actually sell for.

The proposed five-year revaluation cycle makes this problem particularly important.

4. The administrative cost could become ridiculous

Let's consider what HMRC is proposing to achieve.

It needs to identify properties potentially above the threshold, collect information, examine evidence, arrange inspections where necessary, establish valuations, notify owners, deal with objections and process appeals.

Then it needs to maintain the information and repeat the exercise.

Every disputed valuation potentially means more correspondence, more professional evidence, more staff time and potentially tribunal proceedings.

And who pays for this enormous administrative exercise?

The taxpayer, naturally.

The government might advertise the scheme as a way of raising additional revenue, but the real question is how much will remain after the cost of administering and defending it.

A system that generates hundreds of millions in headline revenue is not necessarily an efficient system if a substantial proportion is consumed by bureaucracy, professional fees and disputes.

There is a fundamental difference between raising tax revenue and creating an expensive tax-collection machine.

5. The privacy question is not going away

There is something deeply uncomfortable about the state photographing people's homes as part of a taxation exercise.

The government might argue that photographs taken from public roads are lawful.

That does not automatically make the exercise sensible, proportionate or welcome.

A home is not simply an asset on a government spreadsheet. It is a private place where people live, raise families, retire and spend their lives.

There is a legitimate question about how much information the state needs to collect, how it is stored, who can access it and how long it is retained.

A parliamentary answer on 5 November 2026 confirmed that the Valuation Office's guidance treats internal and external photographs as important to property surveys. It also confirmed that permission is required for photographs taken from within the property boundary, but not from the public highway. Photographs used in council tax casework are retained under the agency's information-retention schedules.

Parallel Parliament+1

The government should explain precisely what safeguards apply.

How long are these images kept? Who has access? Can they be shared with other departments? What happens if the information is inaccurate?

These are reasonable questions, not evidence of someone having something to hide.

6. What happens when HMRC gets the valuation wrong?

This is arguably the most important practical issue.

Imagine a retired couple who have lived in their home for 35 years.

They bought it decades ago. They have maintained it, improved it and watched the surrounding area become increasingly desirable.

They have no intention of selling.

Suddenly, an HMRC valuation exercise determines that their home is worth £2.1 million.

They are now facing an additional annual tax charge despite having no additional income and no extra money in their bank account.

They disagree with the valuation.

What happens next?

They may need to gather comparable sales evidence, obtain independent professional advice and challenge the assessment.

This is not a trivial exercise, particularly for older homeowners and people on fixed incomes.

And it raises a much bigger question: why should a homeowner have to spend money defending a valuation that the government has arrived at using information the homeowner may not even have seen?

A fair system needs transparent methodology, accessible appeals and a proper right to challenge the evidence.

Without those safeguards, the process risks becoming an exercise in making people prove the government wrong.

7. The government is confusing property wealth with disposable income

There is also a basic economic misunderstanding behind this policy.

A house worth £2 million does not mean its owner has £2 million sitting in a bank account.

It might be a family home inherited from parents. It might be a property purchased decades ago when prices were a fraction of today's levels. It might belong to someone who is asset-rich but income-poor.

Property values are not the same thing as personal wealth available to spend.

This is particularly relevant in areas where house prices have risen dramatically over several decades.

A homeowner could be living in a modest property by local standards, yet find themselves caught by a threshold that reflects historic house-price inflation rather than their actual financial circumstances.

The government is effectively treating an increase in the notional value of someone's home as though it were an increase in their disposable income.

It isn't.

Deferral arrangements may help some eligible households, but they do not resolve the underlying question of whether the tax is fair in the first place.

8. The bigger problem: Britain needs tax reform, not another inspection regime

There is no serious argument that Britain's council tax system is fit for purpose.

Council tax bands in England are still based on property values dating back to 1991.

That is an extraordinary state of affairs.

But the answer to an outdated taxation system is not to bolt an additional surcharge onto it and send inspectors around photographing houses.

The answer should be a proper, transparent review of property taxation.

That means examining the relationship between property values, household incomes, regional differences, housing costs and the ability to pay.

It also means recognising that a property valuation is not an exact science.

The government appears to have chosen the politically attractive option of targeting expensive homes without properly confronting the administrative and economic difficulties of doing so.

That is not reform. It is tax policy by spreadsheet.

9. Why this scheme simply won't work as intended

Let's be clear. The Valuation Office can undertake property valuations. It already has experience of doing so.

But that is not the same as saying this particular exercise will be straightforward, cheap or accurate.

The fundamental weaknesses

• Photographs cannot establish market value.
• They provide evidence of appearance, not a reliable assessment of condition, defects or saleability.
• Valuations are subjective.
• Different qualified professionals can reach different conclusions about the same property.
• Property markets change.
• A valuation can become outdated surprisingly quickly.
• The threshold creates disputes.
• Small valuation differences can produce substantial differences in tax liability.
• Administration will be expensive.
• Inspections, evidence gathering, objections and appeals all consume public resources.
• Public confidence will suffer.
• Intrusive inspections and opaque valuations are likely to create resentment rather than acceptance.

Conclusion: HMRC needs a reality check

The government seems to believe that if it photographs enough houses, counts enough bedrooms and gathers enough information, it can somehow produce a perfectly accurate property-tax valuation system.

It cannot.

The housing market is too complex, property is too individual and market values are too dependent on circumstances that cannot be established simply by looking at a building.

There will be disagreements. There will be appeals. There will be costly professional valuations. There will be homeowners who feel unfairly targeted and others who simply cannot understand how their property has been assessed.

And all of this is being introduced to support a tax that has yet to demonstrate that its collection and administration will be proportionate to the revenue it raises.

Britain does not need an army of property photographers. It needs a government that understands the difference between the value of someone's home and their ability to pay another tax bill.

HMRC should be concentrating on making the tax system simpler, fairer and more efficient, rather than turning property ownership into an invitation for another round of official scrutiny.

A camera is not a valuation. A photograph is not proof of wealth. And an expensive bureaucratic exercise does not become good public policy simply because the government has decided it wants more tax revenue.

The British homeowner deserves better.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC's Tax Propaganda for Eight-Year-Olds

 

HMRC's Tax Propaganda for Eight-Year-Olds: Brainwashing the Next Generation of British Taxpayers

Forget teaching children how to build a business, save money or create wealth. HMRC has a rather different lesson plan: convince them that taxation is wonderful, government knows best and life without the taxman would be little short of the Stone Age.

There is something deeply sinister about a government department deciding that children as young as eight need to be educated in the supposed virtues of taxation.

Not educated about how the tax system works. Not taught how to read a payslip, understand National Insurance, calculate VAT or manage their finances.

No. HMRC wants to teach them that taxation is the great benevolent force holding civilisation together.

Welcome to Junior Tax Facts, the Government's attempt to introduce the next generation to the joys of handing over their hard-earned money before they have even had their first Saturday job.

According to revelations published by Guido Fawkes, HMRC's classroom materials, updated this autumn, contain a remarkable series of videos and exercises aimed at children aged between eight and 13. The message is remarkably consistent: tax is good, government spends it wisely, and without it practically everything that makes modern life bearable would disappear.

This isn't balanced financial education. It is a taxpayer recruitment campaign.

And the fact that it is being aimed at primary-school children makes it all the more extraordinary.

Apparently, without tax we'd all be living with woolly mammoths

One of the videos presented to children explains that tax is essentially a giant shared bank account into which everybody pays, with the Government responsible for looking after the money and distributing it for the benefit of everyone.

Already, that is a rather generous description of the relationship between taxpayers and the state.

The video then suggests that without taxation, schools, teachers, hospitals, ambulances, libraries, museums, rubbish collection, police officers and firefighters would all disappear.

Quite a proposition.

The implication is unmistakable: question taxation and you are effectively questioning the existence of civilisation itself.

Another video takes the argument even further, asking children to imagine life in the age of woolly mammoths, sabre-toothed tigers and cavemen.

Apparently, without the wonders of taxation, there would have been no teachers, doctors or police officers to protect them from ravenous beasts.

It's difficult to know whether to laugh or despair.

One might reasonably point out that taxation is not the only way of organising and funding services, that different countries operate different systems, and that public services are delivered through a mixture of public institutions, private enterprise and voluntary organisations.

But apparently eight-year-olds are not considered ready for that level of nuance.

Instead, they get the prehistoric horror story.

The missing lesson: governments can waste money too

The most revealing thing about these materials is not what they teach. It is what they leave out.

There is no meaningful examination of the economic consequences of taxation. No acknowledgement that taxes can discourage investment, reduce incentives to work, make employing people more expensive or deter entrepreneurs from starting businesses.

There is apparently no mention of the Laffer Curve, the economic concept illustrating how tax rates can affect the amount of revenue governments ultimately collect.

Nobody seems particularly interested in explaining that higher rates do not automatically produce higher revenues, or that the tax system can influence the decisions people make about working, investing and building businesses.

And what about the other side of the relationship?

Where is the lesson explaining that government spending can be inefficient? That public money can be wasted? That politicians make mistakes? That taxpayers have a right to scrutinise every pound spent?

Children are being taught that the Government looks after the shared bank account.

What they aren't being taught is that the Government is spending somebody else's money.

There is a world of difference between explaining why public services need funding and presenting the state as an endlessly benevolent guardian of everybody's finances.

Children invited to invent new taxes

Things become even more revealing when we move to the materials for secondary-school pupils aged 14 to 17.

One classroom exercise invites students to invent a new 10% tax on an item or service.

They are instructed to give their new tax a name, explain why it is a good idea and justify how it will benefit society.

Read that again.

Children are being asked to devise new taxes and make the case for imposing them.

It is difficult to imagine a more one-sided introduction to the politics of taxation.

Why not ask pupils to invent a new tax cut instead? Why not challenge them to consider whether a proposed tax would damage a business, increase prices, reduce employment or make an industry less competitive?

Why not ask them to debate whether the Government should leave more money in the pockets of the people who earned it?

Instead, the exercise starts with the assumption that a new 10% tax is a perfectly reasonable proposition and asks pupils to sell it to their classmates.

The materials also invite pupils to consider what public services they would be prepared to give up if they could pay less tax.

That is a particularly cynical framing of the debate.

It presents lower taxation as a direct trade-off against essential services, without giving comparable attention to the possibility of reducing waste, improving productivity, reforming inefficient programmes or getting better value from existing spending.

The choice is effectively presented as more tax or fewer services.

How convenient for the Treasury.

The great missing spending departments

Perhaps the most extraordinary exercise is the one asking children aged eight to 13 to rank government spending priorities.

Pupils are presented with six categories:

• Health

• Protecting the environment

• Museums

• Armed forces

• Education

• Police

They must rank them from the most deserving of money to the least deserving.

There are apparently no wrong answers.

Except there are some rather conspicuous omissions.

Where is welfare spending? Where is debt interest? Where are pensions? Where is the cost of government administration? Where is the money spent on benefits, subsidies and the vast machinery of the state?

Children are invited to decide whether museums deserve more money than the armed forces, but not whether the Government should spend less on its own enormous welfare commitments.

They can debate how to divide the pie, but they aren't really invited to question how big the pie should be.

That is the fundamental problem with this approach.

A genuinely educational exercise would ask children how government spending is funded, what the competing demands are, whether spending is effective and whether there is a limit to how much money the state can reasonably take from the public.

Instead, the state gets to set the boundaries of the discussion.

Nearly £1 trillion in tax revenue. And they want more?

The timing makes this particularly galling.

HMRC's own annual accounts show that it generated £966.4 billion in tax revenue in 2025–26, an increase of £90.4 billion on the previous financial year. Actual cash receipts were £937.8 billion.

These are staggering sums of money.

The British taxpayer is already funding a state of extraordinary size and cost. Households face income tax, National Insurance, VAT, council tax, fuel duties, stamp duties and a seemingly endless collection of other charges.

Businesses face corporation tax, employer National Insurance, business rates and a multitude of regulatory costs.

And what does the Government want to do with the next generation?

Teach them that the taxman is their friend.

There is a particularly uncomfortable irony in asking children to accept taxation as the price of civilisation while millions of working people are struggling with the cost of living and wondering why public services can still be so difficult to access despite the enormous sums being collected.

If the Government wants to win public confidence in taxation, perhaps it should start by demonstrating that it can spend the money competently.

That would be a far more convincing lesson than a cartoon about cavemen.

What happened to political impartiality?

There is another question that HMRC and the Government need to answer.

The Department for Education's own political impartiality guidance tells schools that political issues should be presented in a fair and dispassionate way, with a reasonable range of significantly different perspectives.

It also warns schools to review teaching materials carefully where they might promote partisan political views or undermine a balanced presentation.

That guidance is particularly relevant here.

Taxation is not simply an administrative subject. The appropriate level of taxation, the size of the state, the balance between public and private provision and the economic consequences of tax policy are all legitimate and often fiercely contested political questions.

HMRC is perfectly entitled to explain how taxes work.

It is perfectly entitled to explain that taxes fund public services.

But when its teaching materials repeatedly present taxation as an unquestionable social good, invite children to invent new taxes and omit meaningful discussion of the costs and consequences, serious questions arise about whether the material provides the balance children deserve.

HMRC should explain its approach and identify what safeguards are in place to ensure that its educational programme does not become an exercise in promoting the Government's preferred economic philosophy.

The state has form

This is not even the first time HMRC has attracted criticism over its approach to educating children.

Back in 2012, an earlier tax education module prompted controversy after pupils were reportedly encouraged to think about people in their local communities who might be avoiding tax.

Critics likened the exercise to encouraging children to spy on their neighbours.

Fourteen years later, the concern has evolved, but the underlying question remains: how far should a government department go in shaping children's attitudes towards taxation and the authority of the state?

The answer should be fairly obvious.

Teach children the facts. Explain the rules. Encourage questions. Allow them to challenge assumptions.

Do not turn the classroom into an extension of the tax department's communications strategy.

Teach children to think, not just to pay

Britain needs better financial education, not less of it.

Children should leave school understanding income tax, National Insurance, VAT, pensions, savings, mortgages, debt and the practical realities of running a business.

They should understand how wealth is created, why entrepreneurs take risks, how investment generates jobs and why economic growth matters.

They should also understand that government has an important role in society, but that its resources are finite and its decisions deserve scrutiny.

Most importantly, they should learn that taxation involves choices and trade-offs. There are legitimate arguments about how much the state should collect, how it should collect it and what it should spend the money on.

Those arguments should not be hidden from children simply because they might make the Treasury uncomfortable.

There is something profoundly wrong with a system in which an eight-year-old is taught that without taxation the world would collapse into a prehistoric nightmare, while the economic arguments against ever-higher taxes are nowhere to be found.

The Government should be encouraging children to become independent thinkers, not compliant little taxpayers.

If HMRC wants to produce an educational programme, perhaps its next video could explain why people work hard to earn money, why businesses create wealth, why governments sometimes waste it and why citizens should never be afraid to question how much of their money the state takes.

But perhaps that would be a lesson too far for the taxman.

The next generation deserves an education, not an HMRC sales pitch.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC Records Are Private, Yet The Government Are Opening Them To Energy Companies!

 

YOUR TAX RECORDS ARE PRIVATE. SO WHY IS THE GOVERNMENT OPENING THE DOOR TO ENERGY COMPANIES?

Your electricity supplier wants to know what you earn. The Government holds your tax records. And now the boundaries between the two are being redrawn.

There was a time when the relationship between you and your energy supplier was straightforward.

You used electricity and gas. They sent you a bill. You paid it.

Your energy company had no legitimate reason to know your annual income, your tax affairs, your pension arrangements or the financial details of your private life.

But apparently, those boundaries are now up for discussion.

The Government is pursuing arrangements for sharing information from public authorities, including HMRC, to help energy companies identify households for targeted support.

And this raises a fundamental question:

Whatever happened to the confidentiality of our tax records?

HMRC RECORDS ARE SUPPOSED TO BE PRIVATE. THAT IS THE LAW.

This is not simply about people feeling uncomfortable with their personal information being shared.

There is a very real legal principle at stake.

Under Section 18 of the Commissioners for Revenue and Customs Act 2005, HMRC officials are subject to a statutory duty of confidentiality.

The legislation places restrictions on the disclosure of information held by HMRC. It recognises that taxpayers provide the Government with highly personal financial information on the understanding that it will be protected and only disclosed where there is lawful authority.

Section 19 also provides for criminal sanctions for wrongful disclosure of identifiable taxpayer information.

In other words, taxpayer confidentiality is not some optional courtesy. It is a fundamental part of the legal framework governing HMRC.

So why are we now contemplating arrangements that could allow information from these confidential government records to be used in connection with private energy companies?

Yes, legislation can create specific legal gateways for information sharing. But the existence of a legal gateway does not mean that every proposed use of confidential information should automatically be accepted without scrutiny.

The question is whether this expansion is necessary, proportionate and properly protected.

And the public deserves a proper explanation.

YOUR TAX AFFAIRS ARE NONE OF YOUR ENERGY COMPANY'S BUSINESS

Think about what HMRC knows about you.

Your income. Your employment. Your tax position. Information relating to benefits and other financial circumstances.

Now consider why an energy supplier should need access to information derived from those records.

You didn't give your energy company permission to become an investigator of your financial circumstances when you signed up for gas and electricity.

You didn't agree to have your personal finances become part of a corporate assessment exercise.

And you certainly didn't expect the information you provide to HMRC to potentially find its way into arrangements involving private energy businesses.

The Government may argue that this is about identifying vulnerable households and targeting financial assistance.

But a worthwhile objective does not remove the need for strict limits on the information being shared.

What exactly will companies receive? Will they see individual financial records or simply an indication of eligibility? Who will have access? How long will information be retained? What happens if it is inaccurate?

These are basic questions, not unreasonable demands.

YOUR HOUSE MAY BE WORTH A FORTUNE. THAT DOESN'T MEAN YOU ARE.

The inclusion of property valuation information raises another serious concern.

A property valuation tells us what a house might be worth. It does not tell us how much money its owner has in the bank.

Someone who bought a modest home 30 years ago may now own a property worth considerably more. But that doesn't mean they have a large pension, substantial savings or sufficient disposable income to absorb rising energy costs.

A home is not a cash machine.

A property valuation is not a measure of monthly affordability.

And the idea that someone's financial circumstances can be fairly assessed simply by looking at the estimated value of their home deserves considerable scrutiny.

What about pensioners? What about people on modest incomes? What about those who are asset-rich but cash-poor?

Will the system understand the difference between wealth on paper and money available to pay the bills?

WHERE DOES CONFIDENTIALITY END AND CORPORATE ACCESS BEGIN?

The wider concern is the gradual expansion of information sharing between government departments and private organisations.

HMRC holds information because it has a statutory responsibility to administer the tax system.

It is not a commercial database.

It is not a resource for businesses to exploit.

It contains information supplied by individuals who are legally required to provide accurate details of their financial affairs.

That relationship depends on confidentiality and public trust.

The Government itself acknowledges the importance of taxpayer confidentiality in its own published guidance.

So if the Government wants to expand the circumstances in which information can be disclosed, it must explain exactly why that is necessary and what safeguards will apply.

It is not enough to say that data sharing makes administration easier.

Convenience is not a sufficient justification for weakening important privacy boundaries.

WHAT HAPPENS WHEN THE INFORMATION IS WRONG?

There is another problem that should not be overlooked.

Information held by government departments is not necessarily a complete or accurate picture of someone's current financial circumstances.

Records can be outdated. Circumstances change. Property valuations can be misleading. Income does not necessarily reflect disposable income.

If information is used to determine eligibility for energy support, or potentially to influence how households contribute towards a scheme, mistakes could have real financial consequences.

Who corrects those mistakes?

Who takes responsibility?

Will people know what information has been used to assess them?

And will they have a meaningful right to challenge decisions?

These questions must be answered before such arrangements become normalised.

THE GOVERNMENT NEEDS TO EXPLAIN ITSELF

The public deserves clear answers to some very straightforward questions:

1. Exactly what information will HMRC disclose?

2. Will energy companies receive identifiable individual tax information or only limited eligibility information?

3. What specific legal provisions authorise the disclosure?

4. Why is access to this information necessary?

5. Who within energy companies will be permitted to access it?

6. Will the information be stored, and for how long?

7. Can it be used for purposes other than administering the relevant support scheme?

8. What safeguards prevent onward sharing or misuse?

9. How can individuals find out what information has been shared about them?

10. What happens when the information is wrong?

Most importantly, why should people have to accept the expansion of corporate access to information they reasonably expect HMRC to keep confidential?

PRIVACY SHOULD NOT BE THE PRICE OF GETTING HELP WITH YOUR ENERGY BILL

Let's be absolutely clear.

Nobody is arguing against helping people who cannot afford to heat their homes.

Nobody is suggesting that vulnerable households should be abandoned.

But helping people and expanding access to their confidential financial information are two separate issues.

We can debate how energy support should be funded. We can debate eligibility. We can debate how best to identify households in need.

What we should not do is treat taxpayer confidentiality as an inconvenient obstacle to administrative efficiency.

HMRC's statutory duty of confidentiality exists for a reason. People should be able to provide information to the tax authorities without feeling that it could routinely become available to private businesses for purposes far removed from collecting tax.

There must be clear legal authority, strict limitations, meaningful oversight and genuine accountability.

Our tax records are private. Our financial circumstances are personal. And our homes are not open invitations for corporations to investigate our wealth.

The Government needs to remember that the information it holds does not belong to it in some unrestricted sense. It holds that information under specific legal responsibilities, including a duty to protect its confidentiality.

The public should not have to wonder whether paying their energy bill now comes with an expectation that their private financial lives are available for inspection.

If the Government believes these arrangements are justified, it should have no difficulty explaining them in full.

Because the public is entitled to ask one very simple question:

If HMRC is legally obliged to protect our tax information, why is the Government creating new routes for that information to be used by private energy companies?

And it deserves an answer.

This is a disaster waiting to happen, and waiting to be hacked! 

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MTD Bill Hits £1BN, and Still Rising!

 

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Angela Rayner's 14-Year Threat to Hoteliers

 

Angela Rayner's 14-Year Threat to Hoteliers: One Rule for Politicians, Another for Everyone Else?

Britain's hospitality businesses are being warned of potentially 14 years in prison for fraudulent evasion of a proposed visitor tax. Yet when Angela Rayner found herself at the centre of a £40,000 stamp duty controversy over her own £800,000 Hove flat, the outcome was very different. Is this really what equal accountability looks like?

There is something deeply uncomfortable about the Government's latest approach to Britain's hospitality industry.

Under proposals in the Visitor Levy Bill, accommodation providers could face a maximum prison sentence of 14 years for fraudulent evasion of the new tax.

Fourteen years!

At a time when independent hotels, guest houses, B&Bs and holiday accommodation providers are struggling with rising costs, increased taxation and mounting bureaucracy, the Government appears quite happy to reach for the most severe criminal penalties.

But perhaps before lecturing the hospitality industry about tax compliance, Angela Rayner should reflect on her own experience with HMRC.

A £40,000 stamp duty mistake on an £800,000 flat

In September 2025, Angela Rayner admitted that she had underpaid stamp duty on her £800,000 flat in Hove.

The issue centred on whether the property qualified as her only home or whether she should have paid the higher rate applicable to an additional property.

Rayner had paid approximately £30,000 in stamp duty when the correct amount was £70,000.

The £40,000 shortfall arose from the complicated ownership arrangements involving her former family home in Ashton-under-Lyne and a trust established for her disabled son.

Rayner initially relied on legal advice that she did not owe the additional stamp duty. Following further specialist tax advice, she acknowledged that the higher rate applied.

The controversy became sufficiently serious that she resigned as Deputy Prime Minister and Housing Secretary in September 2025, after the independent ministerial standards adviser concluded that she had breached the Ministerial Code.

And what happened next?

In May 2026, HMRC concluded its investigation. It found that Rayner had not deliberately sought to avoid tax and had exercised reasonable care. She paid the outstanding £40,000 but received no penalty.

That is an important distinction: HMRC did not find her guilty of tax evasion. But the episode raises a legitimate question about the standards of accountability expected of those who make the laws governing everyone else.

Would an ordinary hotelier receive the same consideration?

This is the question that deserves asking.

Imagine an independent hotel owner facing a complicated new tax regime, making an error in calculating what is owed and subsequently discovering that the amount paid was incorrect.

Would that business owner receive the same level of consideration, access to specialist advice and opportunity to put matters right?

Or would they face an aggressive investigation, financial penalties and the prospect of criminal proceedings if deliberate fraud were suspected?

Of course, the proposed 14-year sentence relates to fraudulent evasion, not an innocent accounting mistake. But that does not remove the need to examine whether the legislation is proportionate and whether ordinary businesses will be adequately protected from overzealous enforcement.

The Government must not create a system in which small businesses feel that one compliance dispute could destroy everything they have worked for.

The hypocrisy question Angela Rayner cannot ignore

There is an obvious political problem here.

Angela Rayner has been at the centre of a major personal stamp duty controversy, acknowledged that the wrong amount had been paid and ultimately settled the additional tax.

She was also found to have breached the Ministerial Code over her handling of the matter.

Although HMRC subsequently cleared her of deliberate tax avoidance and carelessness, the public is entitled to question the apparent contrast between the treatment of a senior politician and the extraordinarily severe penalties now being proposed for the hospitality sector.

Politicians cannot expect the public to accept tough tax enforcement without also demanding transparency, proportionality and accountability from those in government.

It is not enough to say that the law must be obeyed. Those making the laws must demonstrate that they understand the consequences of getting tax matters wrong themselves.

Hospitality businesses deserve better

Britain's hospitality industry is not some bottomless source of Government revenue.

Independent hotels, guest houses and accommodation providers support local employment, tourism, suppliers and high streets. Many are family businesses that have spent decades building their livelihoods.

They are already dealing with rising operating costs, business rates, wages, energy bills and other tax obligations.

Now they face another proposed levy, backed by the prospect of a maximum 14-year prison sentence for fraudulent evasion.

The Government needs to explain why such an extraordinary maximum penalty is necessary, how it will distinguish deliberate fraud from genuine mistakes and what safeguards will protect small operators.

One standard of accountability, please

Nobody is suggesting that politicians should be immune from scrutiny. Equally, nobody is suggesting that deliberate tax fraud by hospitality businesses should be ignored.

But fairness must work both ways.

If the Government expects Britain's hoteliers to meet their tax obligations to the letter, it must also demonstrate that those in public office are held to high standards of responsibility and transparency.

Angela Rayner has had the opportunity to explain her own circumstances, correct the stamp duty shortfall and receive HMRC's final decision.

Hospitality businesses deserve a tax system that offers clarity, fairness and proportionate treatment too.

The question is not whether deliberate tax fraud should be punished. It should. The question is why the Government believes a potential 14-year prison sentence is an appropriate threat to attach to its new hospitality tax, and whether it has properly considered the impact on the very businesses it depends upon.

Perhaps before introducing more punitive legislation, the Government should remember that public trust is earned through consistency, not double standards.

Britain's hospitality industry deserves a fair deal. Not another tax, another threat and another lecture from Westminster.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC’s £4.4 Billion Customer Service Gamble

 

HMRC’s £4.4 Billion Customer Service Gamble: Apparently, Even the Price Tag Needs an Upgrade

When a government department cannot tell us whether its new customer system will cost £1.7 billion or £4.4 billion, perhaps the first thing it needs to modernise is its approach to spending public money.

There are expensive IT projects. There are eye-wateringly expensive IT projects. And then there is HMRC’s new customer relationship management system, a project with an estimated whole-life cost somewhere between £1.7 billion and £4.4 billion.

Give or take £2.7 billion.

That is not a rounding error. It is not a minor fluctuation caused by the price of computer servers or an unexpected increase in the cost of software licences. It is a difference of £2,700,000,000 — enough money to make even the most seasoned taxpayer wonder whether somebody has accidentally included the national debt in the spreadsheet.

And this is the department responsible for collecting our taxes, scrutinising our finances and expecting ordinary people to account for every penny.

You could hardly invent a more appropriate example of the double standards that make public-sector spending so infuriating.

A budget with a £2.7 billion shrug

HMRC’s published business case puts the estimated cost of its Enterprise Customer Relationship Management programme at between £1.7 billion and £4.4 billion over 15 years, including VAT and an allowance for optimism bias. The department says the figures remain indicative and will be refined as procurement and planning progress.

Let that sink in.

The project is supposed to create a more joined-up customer service platform, replacing more than 70 legacy systems and helping HMRC manage interactions with millions of individuals and businesses.

That may be a worthwhile objective. Nobody seriously argues that a major tax authority should rely indefinitely on fragmented, ageing computer systems.

But how, exactly, does a modernisation project arrive at a price range spanning £2.7 billion?

If a private company presented its board with a business case saying a project might cost £1.7 billion or might cost £4.4 billion, it would reasonably expect some awkward questions. Investors would want to know what was driving the uncertainty, what assumptions underpinned the estimates and what safeguards existed against costs spiralling out of control.

At HMRC, the explanation is that the programme is complex, long-term and subject to uncertainties.

Of course it is complex. It is a major technology programme serving one of the world's largest tax administrations. That is precisely why robust planning, credible cost estimates and disciplined financial controls matter.

Complexity is a reason to demand better estimates, not a permanent excuse for uncertainty.

And optimism bias? Even the terminology deserves scrutiny. In government project planning, optimism bias is an allowance intended to account for the tendency to underestimate costs and overestimate benefits. It is a legitimate risk-management tool. But when the public is presented with a multibillion-pound range, it is entitled to ask how much of that range reflects genuine uncertainty, how much reflects risk allowances and how much could realistically be avoided through better delivery.

The taxpayer should not be expected to treat a £2.7 billion gap as a perfectly ordinary detail.

The department that demands precision from everyone else

There is something particularly galling about this coming from HMRC.

Miss a tax deadline and you may face a penalty. Submit the wrong figures and you may have to explain yourself. Make an error in your tax return and the consequences can follow you long after the original mistake.

HMRC's job is to administer a system in which financial accuracy matters. It expects businesses to maintain records, individuals to report income correctly and employers to operate payroll systems according to detailed rules.

Yet when it comes to one of its own flagship technology programmes, the estimated price can vary by billions.

The comparison is not that taxpayers and government departments face identical legal obligations. They do not. The comparison is about standards. The public is entitled to expect the same seriousness about accuracy, accountability and explaining the numbers from the institution demanding those things of everyone else.

There is no suggestion that HMRC has already spent £4.4 billion, or that the upper estimate is certain to materialise. This is a projected whole-life cost, not a bill already paid.

But that distinction does not make the question go away. It makes scrutiny more important, because the decisions made now will determine how much public money is committed over the years ahead.

If HMRC wants taxpayers to take its financial demands seriously, it should understand why taxpayers expect its own financial planning to withstand serious examination.

A better customer experience — eventually?

HMRC says the new platform will bring customer information together, help staff resolve queries more quickly and provide a more resilient and efficient service.

Fine. Those are sensible ambitions.

The trouble is that taxpayers have heard promises about better digital services and improved customer experiences before. A shiny new platform is not, by itself, proof of a better service.

The real test is brutally simple: can people get their tax questions answered without wasting hours trying to reach someone? Can businesses resolve problems before those problems disrupt their cash flow? Can advisers access reliable information? Can HMRC fix errors quickly and communicate clearly when something goes wrong?

A system that looks impressive in a procurement presentation but leaves customers trapped in the same old bureaucratic maze is not transformation. It is an expensive change of scenery.

And if the department spends billions building a new platform only to discover that its processes remain cumbersome, its information is poorly managed or its staff lack the tools and training to use the system effectively, the software will have solved only a fraction of the problem.

Technology can support better customer service. It cannot substitute for good management, clear processes and a genuine commitment to helping people resolve their problems.

The question is not whether HMRC deserves modern technology. It is whether HMRC can demonstrate that the technology it buys will deliver measurable improvements at a defensible cost.

The benefits need to be scrutinised as hard as the bill

HMRC's business case projects £815.1 million in increased yield and efficiencies over ten years. It also identifies projected savings of between £924 million and £1.25 billion over a 15-year contract period, with the latter figures subject to important assumptions and adjustments.

Those figures matter. They are part of the department's argument that the investment could deliver value for money.

But projected benefits are not the same as realised benefits.

There is a world of difference between forecasting savings in a business case and demonstrating that those savings have actually appeared in the accounts. There is also a difference between benefits directly attributable to a new system and benefits that depend on other transformation projects, changes in working practices or wider improvements across HMRC.

The department itself acknowledges that a significant proportion of the programme's wider value depends on subsequent transformation activity.

That creates an obvious accountability question: if the platform is delivered but the wider changes fail to materialise, who is responsible for the shortfall?

The public should not be left with an expensive system, a set of revised forecasts and an explanation that the promised benefits were always dependent on something else.

Every major milestone should have published performance measures. Every material change in forecast cost should be explained. And the department should report, in plain English, which savings have actually been delivered, which remain forecasts and which have been abandoned.

If the business case relies on benefits, those benefits must be measured. Otherwise, the business case risks becoming little more than a collection of optimistic assumptions wrapped around an enormous bill.

Fifteen years is a very long time to keep paying

The programme is designed to operate over a 15-year period, running from 2025–26 to 2040–41.

That is a substantial commitment across multiple spending reviews, changing economic conditions and potentially several changes of government.

Over such a long period, the risks are not confined to the initial procurement. Software licensing, integration, maintenance, migration, supplier dependence, changing requirements and future upgrades can all affect the eventual cost.

The longer the contract, the more important it becomes to establish clear exit arrangements, enforceable performance standards and realistic mechanisms for controlling costs.

There is also a basic question about supplier dependence. A platform intended to replace dozens of legacy systems may simplify HMRC's technology estate, but it must not simply exchange one form of complexity for a long-term reliance on a single supplier.

The public needs assurance that HMRC will retain control over its data, understand the cost of future changes and be able to challenge the supplier if performance or value for money deteriorates.

A 15-year technology relationship is not something to enter casually. Nor should it be treated as an excuse to defer accountability until the contract is well underway and the cost of changing direction has become prohibitive.

Who is accountable if the numbers rise?

HMRC says expenditure will be committed incrementally, with further approvals and value-for-money assessments as the programme develops. That is an important safeguard.

But safeguards are only meaningful if they lead to real consequences.

What happens if costs rise materially? What happens if the timetable slips? What happens if the promised improvements in customer service fail to materialise? What happens if the benefits are revised downwards while the costs continue upwards?

The public should not have to wait until the end of a 15-year programme to discover whether the original business case was credible.

There should be transparent reporting against the original baseline, independent scrutiny of major changes and clear explanations whenever a project moves materially away from its approved assumptions.

Parliament and taxpayers need to be able to distinguish between a justified change in scope and a programme losing control of its costs.

And there should be no convenient resetting of the baseline every time the figures become uncomfortable. If the original estimate changes, the original estimate should remain visible.

That is how accountability works: not by promising that everything will be fine, but by making it possible to establish what happened when it was not.

The real scandal would be learning nothing

To be fair, HMRC is not wrong to modernise its systems. Maintaining more than 70 legacy customer management systems indefinitely would bring its own costs, operational risks and potential failures. A properly delivered, well-governed programme could improve service, reduce duplication and make the department more efficient.

The case for investment is not the problem.

The problem is the scale of the uncertainty, the enormous sums involved and the need to demonstrate that the final outcome justifies the expense.

A sensible approach would mean publishing a clearer breakdown of the cost range, explaining the assumptions behind the lower and upper estimates, reporting the expected cost per stage and establishing firm measures of success before substantial further commitments are made.

It would also mean reporting actual customer outcomes, not simply counting systems replaced, contracts signed or digital features launched.

Because the ultimate measure of success is not whether HMRC acquires an impressive new technology platform. It is whether taxpayers receive a demonstrably better service without public money being squandered along the way.

Conclusion: taxpayers deserve more than a multibillion-pound question mark

HMRC's new customer system may eventually prove to be a worthwhile investment. It may replace ageing technology, improve staff productivity and make dealing with the tax authority less frustrating for millions of people.

But those outcomes must be demonstrated, not assumed.

For now, the department's published estimate leaves an uncomfortable question hanging over the entire exercise: how can the public have confidence in the financial discipline of a programme whose estimated whole-life cost ranges from £1.7 billion to £4.4 billion?

A difference of £2.7 billion is not a footnote. It is the sort of gap that demands a detailed explanation, rigorous oversight and a clear plan for controlling expenditure.

HMRC expects taxpayers to account for their money. It should expect no less of itself.

And if the department wants the public to believe that this multibillion-pound transformation represents value for money, it needs to do more than promise a better customer experience.

It needs to prove it.

Because when the bill could be £1.7 billion or £4.4 billion, the public is entitled to ask a very simple question: who, exactly, is keeping the receipts?

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Sources and further reading

• HMRC: Enterprise Customer Relationship Management Programme — Summary Business Case

• HMRC: Accounting Officer Assessment Summary

• HMRC: Transformation Roadmap Update 2026

The cost figures cited above are estimates of the programme's whole-life costs over 15 years, including VAT and optimism bias. They are not a statement of expenditure already incurred. 

 HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"