HMRC is set to eliminate paper correspondence for millions of taxpayers starting in April of the following year. The tax office’s move towards a “digital by default” approach aims to achieve annual savings of £50 million by the fiscal year 2028/29.
In the recent Budget announcement, HMRC confirmed the gradual phasing out of paper letters, commencing in April 2026. Going forward, taxpayers will receive digital correspondence through their HMRC online account or the HMRC app. However, households without internet access or facing difficulties with digital services will continue to receive letters by post, with HMRC maintaining open phone lines for assistance.
Taxpayers who currently use the HMRC app, online Personal Tax Account (PTA), or Business Tax Account (BTA) will be among the initial groups affected by the transition. HMRC will prompt individuals to verify their contact details once the rollout begins to ensure accuracy. Letters from HMRC serve various purposes, including notifying taxpayers of changes in tax codes or requirements for self-assessment registration.
HMRC has already dispatched over 200,000 letters to sole traders and landlords with qualifying income exceeding £50,000. These individuals will soon need to submit quarterly updates using HMRC-approved software if their turnover surpasses £50,000 from self-employment or property income. While the rollout starts in April 2026, HMRC advises taxpayers to prepare for the transition in advance.
Taxpayers will need suitable software for compliance, with both free and paid options available. The software will provide real-time tax bill estimates, aiding in cash flow management and preventing surprises during tax season. For those using spreadsheets or accounting software, compatible options that meet the new requirements are recommended.
Craig Ogilvie, the director of Making Tax Digital, emphasized the importance of preparing for the upcoming changes, highlighting the benefits of spreading tax administration tasks throughout the year. Early participants testing the system have provided positive feedback, noting its user-friendly nature once familiarized with it.
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