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Solving HMRC’s woes by simple methods

by Dennis Howlett on February 1, 2008

Each year UK professionals go through a pantomime of endeavouring to file their clients’ self assessment tax returns only to find the HMRC service is broken. Earlier today I reported on the outage and later, I learned that HMRC has granted a one day extension for those unable to complete their filing. This is of little comfort to practitioners who through no fault of their own are forced to burn the midnight oil in an attempt to keep their clients compliant.

There will always be clients who leave things to the last minute. So what? HMRCs systems should be robust enough to cater for that situation. Once again, it seems they are not. How might this be resolved? There are several solutions.

First, HMRC could re-evaluate its approach to scaling. Amazon, with its EC2 architecture has proven that cloud computing is a viable proposition even if EC2 isn’t great on handling demand spikes. Joyent, which handles around 12 per cent of Facebook’s daily applications traffic – ie 3.8 million requests – knows how to provide virtualized scale. There is a quantum difference between a Facebook application and data pumped via the SA Online system. But the architectures needed to make this stuff work are well known. That requires a different type of consulting engagement than those to which HMRC is used.

It’s hard to know who’s doing what these days but clearly one of EDS, KPMG or Accenture have failed to come up with a scalable model. That surprises me because all have plenty of experience in moving data around for banks in real time. But then I appreciate HMRCs requirements are fundamentally different.

The alternative is to take what does work – and SA Online does work when not totally stressed – and simply provide different filing dates for different parts of the country. HMRC has enough statistical data to broadly calculate where demand is coming from and it could easily figure how to make this work. That’s the method that has been followed in France for years and it just works.

HMRC would take a short term PR hit but that would be easily outweighed by the positive PR it would attract from those practitioners who are currently staring bleary eyed at a failed system.

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  • Dennis

    Aside from the tech issue there are 4 fundamental problems wrt HMRC

    1 The tax system is far too complicated

    2 The Inland Revenure and Customs merger was a mistake in concept and execution

    3 The "downsizing" of HMRC has not been thought through or exected properly

    4 HMRC has become politicised and has lost focus on its true mission: that of being an administrative function designed purely to collect tax in the most effecient and cost effective manner possible.

    I will be developing these themes on my site over the coming weeks

    Ken

    http://www.hmrcisshite.com
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