66% of ACCA members agree poor HMRC services hurt SMEs

Some 66% of ACCA members reported that poor HMRC services were having a negative impact on their clients, with small businesses bearing the brunt of this issue, according to the association’s latest survey. 

The survey, which was carried out after the chancellor’s Spring Budget on 6 March, aimed to gather member insights on the budget and proposed actions. 

According to the majority of accountants, core issues failed to be addressed in the budget, and that there was a disconnect between the chancellor and “the reality of small businesses and the UK economy in 2024”.

In the run-up to the budget, ACCA had repeatedly called on the chancellor to invest in HMRC, as the service struggles to keep up with demand for simple requests such as VAT numbers. 

The survey also outlined that productivity and efficiency were the two main areas suffering as a result of poor HMRC services, as there was a 14% rise in negative sentiment from the previous ACCA survey in October 2023. 

In addition, feeling about the UK economic outlook remained on the negative side, with just 4% reporting their clients were more likely to invest in the UK in the 12 months following the Spring Budget announcement. 

However, 34% said the raising of the VAT registration threshold from £85k to £90k was somewhat positive, although as one respondent noted, “the VAT threshold is a problem economically but the rise has no real effect, it still looks like a problem they don’t know how to solve.”

This apathetic feeling around the Chancellor’s budget was reflected across responses, with 69% believing that the Spring Budget would bring either no change or negative impact to the UK financial outlook. One respondent said it was “a budget full of words and Labour baiting but short on meaningful incentives.”

Glenn Collins, head of strategic and technical engagement at ACCA UK, said: “Our members have repeatedly raised that dealing with HMRC is the number one issue they face in their daily work. Repeatedly, we hear from our members of delays around basic requests such as VAT registration numbers, and a severe lack of skilled staff to handle more complex enquiries.

“ACCA will continue to call for the chancellor to properly fund HMRC, raise the levels of service standards, and to lean on accredited finance professionals wherever possible to ensure accuracy across the board.”