UK taxpayers spent the equivalent of 800 years on hold to HMRC in 2022/23, according to a report published by the National Audit Office (NAO).

The report found that funding pressures, job cuts and a push to reduce costs by encouraging people to manage their tax affairs online had all led to a poor call-handling performance by HMRC.

The average time spent waiting on the phone to speak to an adviser in the 11 months to February 2024 was almost 23 minutes - well above the five minutes recorded in 2018/19.

Altogether taxpayers spent 7 million hours, or 798 years, on hold to HMRC in 2022/23, according to the report.

Customer service is in a 'declining spiral' at HMRC, which had not met its goals for responding to taxpayer correspondence or telephone calls for several years, the NAO added.

The government has recently announced an extra £51 million in funding to help HMRC improve its telephone helplines.

Gareth Davies, Head of the NAO, said: 'HMRC's telephone and correspondence services have been below its target service levels for too long.

'While many of its digital services work well, they have not made enough of a difference to customers, some of whom have been caught in a declining spiral of service pressures and cuts. HMRC has also not achieved planned efficiencies.

'HMRC must allow more time for these services to bed in and understand the difference they make before adjusting staffing levels.'

The UK is falling behind its international competitors in the race for green growth, the Confederation of British Industry (CBI) has warned.

The CBI is urging the UK to unlock the potential of the green economy with tax incentives, which could deliver a boost of £57 billion a year by 2030.

However, the UK risks falling behind as both the US and Europe have introduced impressive reform packages to incentivise green investment, using tax credits, subsidies, grants and loans.

The CBI is proposing a number of recommendations including Green Innovation Credits, lower corporation tax for profits derived from green technologies and an enhanced green super-deduction rate.

Rain Newton-Smith, CBI Chief Executive, said: 'The UK is lagging behind in the global green growth race. Our US and European rivals have bolted out the gate with incentivising reform packages, securing major market share and creating skilled jobs.

'The UK initially led the pack, setting international standards and as the first major economy to sign net zero into law. We must now move at pace to reclaim our lead in this field, to achieve our net zero goals and build in long-term, sustainable economic growth. Public funding alone will not be sufficient.

'As we head into a General Election, political parties have an opportunity to prioritise green growth by using their manifestos to set out a package of tax measures that provides the best value for money and impact in bringing the UK closer to its decarbonisation goals.'

The government has announced an extra £51 million in new funding to bring HMRC's phoneline service back up to the published target of 85% of calls to its advisers being answered.

Last year, 75% of people who phoned HMRC had to wait an average 24 minutes for anyone to answer with 650,000 calls abandoned before they were answered.

In response, HMRC told the Parliament's Public Accounts Committee that it did not have the resources to meet rising demand for its phone services.

The extra funding was confirmed in a written statement from Nigel Huddleston MP, Financial Secretary to the Treasury.

Victoria Todd, Head of the Low Incomes Tax Reform Group (LITRG), said: 'The government is right to give HMRC extra resources to better manage demand for its telephone helplines.

'We hope this will mean that taxpayers can have greater confidence that their queries will be answered, and they can continue to comply with their tax responsibilities.

'Moving more taxpayers online is a laudable aim, but more work is needed to improve HMRC's digital services to support that shift. It is likely going to take HMRC some time to deploy this additional resource, meaning things may get worse before they get better.

'In the longer term, funding to maintain customer service levels by phone and post needs to continue until such time as HMRC's digital services are good enough to give taxpayers who can use them the support they need.'

UK adults face a significant shortfall in their pension savings at retirement compared to what they wanted to retire on, according to research from Standard Life.

Standard Life's Retirement Voice Report found that, on average, retirees had hoped to build up a pension pot of £250,0001. However, the average amount that they accumulated by retirement was £131,000 – leaving a £119,000 shortfall.

Based on current annuity rates, a pot of £250,000 could lead to an income of £1,007 monthly, or £12,091 a year, assuming a retirement age of 66.

 A pot of £131,000 could result in a monthly income of £527 in retirement, or £6,332 yearly - £480 month, or £5,759 a year less.

However, the not insignificant £250,000 pot falls short of a 'moderate' standard of living in retirement according to the PLSA, including the State Pension.

Dean Butler, Managing Director for Retail Direct at Standard Life said: 'It can be hard to work out how much you need to save to achieve your desired standard of living in retirement, particularly earlier on in your career. It's even harder to stick to it, as everyday expenses and those one-off costs that come up in life constantly threaten to move long-term saving down the priority list.

'Clearly there's a big gap between what people hope to save, and what they actually do – this is unsurprising, particularly when looking at it during a cost-of-living crisis, however the result can be a significantly reduced standard of living in retirement.'

The UK economy grew by 0.6% between January and March, according to figures from the Office for National Statistics (ONS).

It means that the country has officially emerged from recession with growth led by the services sector.

It follows the Bank of England's decision to hold interest rates at 5.25% for the sixth month in a row.

The Bank signalled that rate cuts should follow later this year.

Ben Jones, Lead Economist at the Confederation of British Industry, said: 'Back-to-back increases in output over the first months of this year suggest the UK is now on the road to recovery. With falling inflation boosting households' spending power, as well as opening the way for a reduction in interest rates in the months ahead, the economy should be able to sustain some momentum through the year.

'But a consumer-led recovery could prove short-lived without more determined action to tackle the long-standing problem of weak productivity growth, which ultimately sets the UK's economic speed limit. 

'Firms want to see action that could help support investment and cut costs which, includes extending full expensing to leased and rented assets, and a business tax roadmap to give firms the certainty and confidence they need to plan ahead and invest in a vibrant UK economy.'

Almost 300,000 self assessment taxpayers filed their return in the first week of the new tax year, HMRC has revealed.

The early filers were almost 10 months ahead of the 31 January 2025 deadline.

Almost 70,000 people filed their return on the opening day of 6 April this year.

HMRC is encouraging people to file early and avoid the stress of last-minute filing.

The tax authority says early filing can also help with budgeting. A budget payment plan helps spread the cost of tax bills with weekly or monthly payments.

In addition, refunds of overpaid tax will be paid as soon as the return has been processed.

Myrtle Lloyd, HMRC's Director General for Customer Services, said: 'Filing your self assessment early means people can spend more time growing their business and doing the things they love, rather than worrying about their tax return.

'You too can join the thousands of customers who have already done their tax return for the 2023-24 tax year by searching 'self assessment' on GOV.UK and get started today.'

An HMRC error could mean that some low-income, self-employed workers lose out on their entitlement to National Insurance-related benefits like the state pension, warns the Low Incomes Tax Reform Group (LITRG).

The issue centres around the payment of voluntary Class 2 National Insurance contributions (NICs) that can be made by self-employed taxpayers with profits under £6,725.1

These voluntary contributions are usually paid by taxpayers as part of their self assessment return and must reach HMRC by the 31 January following the end of the tax year.

HMRC then automatically transfer the NICs to the taxpayer's National Insurance record to be counted towards their entitlement to benefits.

However, it appears that HMRC did not initiate the transfer until after the 31 January deadline for the 2022/23 tax year.

In the absence of any action, this could mean that taxpayers miss a qualifying year of NICs.

Antonia Stokes, LITRG Technical Officer, said: 'The issue is unique to the year in question, and our advice to those who might be affected is to first check to see whether they have received a refund from HMRC.

'We would also like to see HMRC acknowledge the error and proactively offer help to those taxpayers who have been affected, in line with HMRC's own charter commitments. However, until they do so, there are practical steps that taxpayers can take to maintain their entitlement to National Insurance-related benefits.'

The new customs checks and charges that came into force on 1 May are causing confusion and uncertainty for business, warns the British Chambers of Commerce (BCC).

The second phase of the UK's Border Target Operating Model introduced charges of up to £145 for imports of plant and animal products. 

It is the first time for decades that firms will have to pay such fees for EU imports of goods arriving in Great Britain.

There is uncertainty around which consignments are subject to checks, due to issues with border computer systems.

Government figures show the UK imports just under 30% of all the food it consumes from the EU. 

William Bain, Head of Trade Policy at the BCC, said: 'Firms face mounting confusion and uncertainty about exactly how and when the borders checks and costs will be fully implemented. It is crucial for business and trade that the government gives clarity on what is happening.

'The government should immediately exclude firms in the trusted trader scheme from these charges which would give many smaller businesses some relief. But in the long-term, these checks and costs should be done away with by reaching an agri-food deal with the EU, something we have consistently called for. 

'With interest rates still high, inflation well above its 2% target and supply chain disruption continuing to build, these costs and uncertainty are the last thing firms need.'

The UK will see the slowest growth of the G7 nations next year, the Organisation for Economic Co-operation and Development (OECD) has warned.

OECD forecasts show that UK GDP will rise by just 1% in 2025, well below predictions for other G7 nations.

The OECD said that economic growth in the UK will also be 'sluggish' this year.

It expects the UK economy to grow by 0.4% this year, downgraded from its previous prediction of 0.7%. According to the OECD, only Germany will see slower economic growth this year.

Certain measures 'could help to lower fiscal pressure', the OECD said, outlining the government cuts to National Insurance and its Tax-Free Childcare (TFC) scheme as being potentially beneficial.

However, the OECD said that any increase in public spending should happen only after interest rates have been lowered. It predicted that the Bank of England will reduce the cost of borrowing from 5.25% to 3.75% by the end of next year.

The OECD report said: 'Fiscal prudence is required as inflation remains above target, and spending is to be directed towards supply enhancing investment, including infrastructure, the National Health Service, and adult skills

'Proceeding with the childcare reform will help tackle economic inactivity, but requires contingent planning to address potential bottlenecks, in particular likely staff shortages.'

Optimism amongst UK business leaders in regard to the UK economy rose in April 2024, data published by the Institute of Directors (IoD) has revealed.

The IoD's Directors' Economic Confidence Index showed that optimism in prospects for the UK economy rose to -10 in April 2024 from -12 in March.

The business group said that the latest figure 'sustains the leap upwards that the Index experienced in March', and 'continues its steady recovery from its recent low point of -31 in June 2023'.

Optimism regarding businesses' net investment plans for the upcoming year also increased from +18 in March to +21 in April.

Dr Roger Barker, Director of Policy at the IoD, said: 'It remains the case that business leaders are, on balance, pessimistic about UK economic prospects. However, since March, the pessimists have been in retreat. Confidence has been edging upwards and is now within striking distance of a more neutral perspective.

'According to IoD members, the fundamentals are in place for some kind of UK economic recovery.'