KPMG flags 40-measure HMRC tax overhaul, client work ahead

HMRC’s 40-measure tax update lands with immediate work for KPMG teams that handle corporate tax, payroll, customs and indirect tax. The package pushes clients toward digital filing, tighter compliance checks and cleaner data flows, while several measures will change day-to-day routines over the next 6 to 12 months.

From April 2027, Research and Development Expenditure Credits, Audio-Visual Expenditure Credits and Video Games Expenditure Credits will no longer count when HMRC decides whether a company falls into the QIP regime. For KPMG advisers, that means rechecking payment calendars, forecast models and cash tax assumptions for clients that were pulled into instalments mainly because of those credits. It also comes on top of the merged R&D regime already in force for accounting periods beginning on or after 1 April 2024, so the compliance line keeps moving rather than resetting.

Employment tax teams have their own list. HMRC has opened a call for evidence on PAYE Settlement Agreements, closing on 15 September 2026, to understand where the rules create uncertainty for employers and advisers. The update also regularises National Insurance practice for non-resident directors who attend a small number of UK board meetings while based in countries without a social security agreement, and it keeps in place an easement for some employees posted abroad who return briefly to the UK without additional Class 1 NIC.

On the personal tax side, HMRC is moving toward more timely payment of Self Assessment liabilities. The government has consulted on a model that would, from April 2029, require ITSA customers with PAYE income to pay more of their forecast Self Assessment bills in-year through PAYE, with possible changes to payments on account for others. The aim is to reduce tax debt and avoid large unexpected bills. It also published draft legislation on Capital Gains Tax relief for gifts of business assets, adding another item for private client and owner-managed business teams to map into planning work.

Customs and indirect tax are being pulled into the digital shift even faster. HMRC will make Peppol the core interoperability network for UK e-invoicing, while an open call for evidence on customs modernisation began on 23 June 2026. HMRC also plans tests using AI to help customs caseworkers complete real-time border documentary checks. For clients, that points to updates in invoicing systems, customs data fields, trader authorisations and direct debit processes for VAT and PAYE returns.

HMRC’s Transformation Roadmap, published on 21 July 2025, sets a goal of becoming digital-first by 2030 with at least 90% of interactions handled digitally. The UK tax gap for 2024/25 was 6.4%, or £59.2 billion, with small-business non-compliance accounting for the largest share.