The UK’s tax collector is yet to reach the levels of efficiency its investment in digital services has led auditors to expect, according to a new report.

In its annual report on the performance of His Majesty’s Revenue & Customs (HMRC), the National Audit Office (NAO) has set out the challenges facing one of the biggest IT departments in the country as it struggles with a bewildering estate of legacy systems.

In 2024-25, HMRC spent £1.16 billion on IT and telecoms while collecting £858.9 billion in tax. In June’s Spending Review, the government said departments would perform a Zero-Based Review (ZBR) of budgets, taking a "digital-first approach" and involving chief digital and information officers.

The result was that HMRC received an additional £1.6 billion from 2026-27 to 2028-29 to “

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