HMRC rolls out AI assistant in £500m plan to cut wait times and catch tax cheats

HMRC to Launch AI Assistant in £500m Digital Overhaul to Tackle Tax Fraud

HM Revenue & Customs (HMRC) is set to introduce an artificial intelligence (AI) assistant as part of a major government investment of £500 million aimed at transforming its digital services. This initiative is expected to cut waiting times for taxpayers and generate annual savings of £200 million by 2029.

The new “Ask HMRC” digital assistant will be trialled across frontline services, helping the public with enquiries and handling note-taking behind the scenes. This will allow HMRC staff to focus on providing better service while reducing administrative burdens.

Key Efficiency Measures and Savings

• HMRC plans to reduce the number of letters sent by 75% by 2028-2029, saving around £50 million annually.
• The AI assistant will help flag error-prone tax returns and prompt taxpayers to double-check their submissions, potentially reducing mistakes and fraud.
• Despite the increased use of AI, human staff will remain available for queries needing personal attention, ensuring a balance between automation and human oversight.

A government source highlighted the need to change longstanding administrative practices, noting that HMRC currently handles about 100,000 calls daily, while other departments like the DVLA and Defra still rely heavily on paper forms and letters.

Supporting HMRC Staff and Enhancing Compliance

The AI assistant will reduce time spent on routine tasks such as note-taking and data processing. This will free up staff to focus on critical areas like customer service and tax compliance.

Compliance officers will benefit from AI tools that sift through large datasets to identify high-risk cases, helping close the tax gap more efficiently. This technology will also facilitate better collaboration between HMRC and other government departments to detect fraud and errors more effectively.

Wider Government Restructuring and Digital Strategy

This AI deployment is part of a broader government digital investment plan to improve efficiency and reduce bureaucracy. The Cabinet Office recently restructured, cutting around 1,200 staff and reallocating 900 others to different departments, with expected efficiency gains of £10 million annually.

The overall goal is to simplify day-to-day operations at HMRC, saving time for both staff and millions of taxpayers. While AI will speed up many processes, final decisions affecting individuals will remain in human hands.

The full details of HMRC’s Transformation Roadmap, including further digital initiatives, are expected to be announced this summer.

Further Learning and Resources

For government professionals interested in AI applications and training, resources are available to build relevant skills and knowledge. Explore courses on AI, automation, and digital tools at Complete AI Training.