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HMRC Finance, Room C4, South Block, Barrington Road, Worthing BN12 4XH Annual Report and Accounts 2015-16 HM Revenue and Customs Annual Report and Accounts 2015-16 (For the year ended 31 March 2016) Accounts presented to the House of Commons pursuant to Section 6(4) of the Government Resources and Accounts Act 2000 and Section 2 of the Exchequer and Audit Departments Act 1921 Annual Report presented to the House of Commons by Command of Her Majesty Ordered by the House of Commons to be printed on 14 July 2016 HC 338 This is part of a series of departmental publications which, along with the Main Supply Estimates 2016-17, the document Public Expenditure: Statistical Analyses 2016 present the Government’s outturn for 2015-16 and planned expenditure fo r 2016 -17. © Crown copyright 2016 This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: [email protected]. Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned. This publication is available at www.gov.uk/government/publications Any enquiries regarding this publication should be sent to us at HMRC Finance, Room C4, South Block, Barrington Road, Worthing BN12 4XH Print ISBN 9781474135153 Web ISBN 9781474135160 ID 27061601 07/16 Printed on paper containing 75% recycled fibre content minimum Printed in the UK by the Williams Lea Group on behalf of the Controller of Her Majesty’s Stationery Office Contents 6 Your Charter 70 Accountability — how we are managed and scrutinised 7 Who we are and what we do 70 Governance Statement 8 Our achievements in 2015-16 70 Foreword by Ian Barlow, 10 Introduction by Edward Troup, Executive Chair Lead Non-Executive and Permanent Secretary 72 How we are structured 12 Foreword by Jon Thompson, Chief Executive and Permanent Secretary 86 Managing risks to our objectives 92 Our control environment 16 Performance — how we did and our plans 98 Recommendations made by external 16 Maximising revenues scrutiny bodies 34 Improving customer services 100 Responding to external opinion 42 Investment, efficiency and providing 102 Sharing our data with others value for money 56 Delivery against our 2014-16 Business Plan 110 Remuneration and staff report — 60 Receivables, debt and other liabilities our people and pay 66 Valuation Office Agency 138 Parliamentary accountability 159 Financial statements 215 Glossary to the Financial Statements 219 Statistical tables R1 Report by the Comptroller and Auditor General Look out for these icons throughout this report Read more content within this report Read more content online HM Revenue and Customs 5 Your Charter Mission statement We are the UK’s tax, payments and customs authority, and we have a vital purpose: we collect the money that pays for the UK’s public services and help families and individuals with targeted financial support. We do this by being impartial and increasingly effective and efficient in our administration. We help the honest majority to get their tax right and make it hard for the dishonest minority to cheat the system. Your Charter — Our role We want to give you a service that is fair, accurate and based on mutual trust and respect. We also want to make it as easy as we can for you to get things right. “Your Charter” explains what you can expect from us and what we expect from you. For more information about our Charter go to www.gov.uk/government/publications/your-charter/your-charter Your rights — Your obligations — What you can expect from us: What we expect from you: • Respect you and treat you as honest • Be honest and respect our staff • Provide a helpful, efficient and effective service • Work with us to get things right • Be professional and act with integrity • Find out what you need to do and keep us informed • Protect your information and respect your privacy • Keep accurate records and protect your information • Accept that someone else can represent you • Know what your representative does on your behalf • Deal with complaints quickly and fairly • Respond in good time • Tackle those who bend or break the rules • Take reasonable care to avoid mistakes The Charter rights and obligations are part of our everyday work and are central to helping us maximise revenues, improve customer service and make sustainable cost efficiencies. We report on our progress in the Charter Annual Report that can be found at www.gov.uk/government/publications/your-charter-annual-report-2014-to-2015 More information can also be found on page 100. 6 Annual Report and Accounts 2015-16 About HMRC Who we are and what we do Our objectives Our key objectives in 2015-16, set by the government, were to • maximise revenues • improve the service that we give our customers • make sustainable cost savings. We revised these at the start of 2016-17, with HM Treasury’s agreement, to reflect our rapid transformation into a smaller, more highly-skilled and digital organisation. Our key objectives are now to: • maximise revenues due and bear down on avoidance and evasion • transform tax and payments for our customers • design and deliver a professional, efficient and engaged organisation. What we do We are one of the UK’s biggest organisations. At 31 March, we had around 58,600 full-time equivalent employees in 167 offices across the UK, collecting tax and duties from 45 million individuals and more than 5.4 million businesses, and paying tax credits to 4.4 million families and Child Benefit to 7.4 million families. We contribute to the country’s economic and social wellbeing, support growth and as a socially-responsible organisation, we monitor closely our economic, social and environmental impact. The UK is one of the largest economies in both the EU and the world and we play our part by making it easier for business to trade. We work closely with HM Treasury through the Policy Partnership to deliver effective tax policy which meets government objectives, working together on policy design through to implementation. We are uniquely placed to provide advice on the implementation of tax policies using our considerable expertise, knowledge and insight of our customers and their behaviour, tax compliance and tax legislation. We also work with a number of other government departments to help deliver their objectives; for example, in collecting student loans and in enforcing the National Minimum Wage and National Living Wage. HM Revenue and Customs 7 Our achievements Our achievements � in 2015-16 Total tax revenues 46,500+ staff attended 616 Building our Future events across 84 locations to discuss £536.8bn our transformation £19.1 billion more than last year 2.5m Launched a new online Personal Tax Account in December 2015, which is being used by more than We brought in record total tax revenues 2.5 million customers, and made the new Business 2014-15 2015-16 3.7% Tax Account available to all 5.4 million businesses by INCREASE for the sixth consecutive year March 2016 754,900 tax credits customers 89% renewed online using of Self Assessment our digital service, returns done online by almost double the 31 January deadline — 2014 figure a record 537 apprentices recruited, including 198 Surge apprentices — a cross- 94% government resource of all customs £14.9bn managed by HMRC, clearances for trade tax protected through who help to deal with cleared within two successful litigation peaks of work hours £210m annual sustainable £26.6bn cost savings, exceeding compliance revenues secured — making a total of more the target set by the than £110 billion since 2011-12 government 8 Annual Report and Accounts 2015-16 HM Revenue and Customs 9 Introduction by the Executive Chair and Permanent Secretary Our Annual Report and Accounts sets out how we’ve performed over the past financial year and explains our continued transformation to become one of the most digitally-advanced tax, payments and customs administrations in the world. We are moving from laying the foundations for our future, to actively building that future, and it is a great privilege to be leading HMRC at a time of such unprecedented change. As HMRC’s Executive Chair, my role is to lead the Board and I have ultimate responsibility for the department’s strategy, safeguarding our reputation and supporting the executive team who are responsible for the department’s performance. I am working closely with Jon Thompson who, as our new Chief Executive, is responsible for the delivery of HMRC’s strategy, including our transformation programme, objectives and performance, so that we can build on the success of the past year — a year which has seen a record amount of tax receipts brought in, as well as securing £26.6 billion from our compliance work to stop tax avoidance, evasion, fraud and non-compliance. Our ability to deliver six consecutive years of increased tax revenues led to the Chancellor’s 2015 Spending Review announcement of an additional £1.3 billion investment in our transformation and confirmed the Summer Budget 2015 announcement of an additional £800 million for investment in compliance activities. Effective, targeted action against those who do not wish to pay provides the framework against which our performance is measured, but the public rightly judge us on the quality of service we provide to the overwhelming majority of people in the UK who are honest and pay the right amount of tax on time. At a time of intense public interest in the design and operation of the tax system, I am committed to cementing HMRC’s reputation as one of the UK’s premier public services and maintaining public confidence that we deal with all of our customers fairly, efficiently and impartially — from individual taxpayers to the largest multinational companies.
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