The department has appointed a firm to take on responsibility for ensuring that key digital tax services maintain performance, compliance and security, while also operating system for deriving manual data

HM Revenue and Customs has picked a supplier to fulfil a multimillion-pound contract to take on development and support of a key digital platform to help the smallest businesses comply with their tax requirements.

The tax agency first indicated about six months ago that it wished to appoint an external provider “to build, run and maintain our Basic PAYE Tool and Paper Capture Tool” – two platforms developed and, to date, operated by HMRC internally.

The chosen supplier – London-headquartered cloud and artificial intelligence specialist VE3 – has now been appointed to a five-year agreement. The deal came into effect on 30 April and is valued at £1.4m a year, plus VAT – equating to overall spending between now and May 2030 of £8.4m.

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The Basic PAYE system, which has both English- and Welsh-language versions, offers a range of digital services dedicated to supporting firms with fewer than 10 employees in their administration of income tax and National Insurance. The Paper Capture Tool, meanwhile, enables HMRC officials to derive data from paper forms sent in by companies – and then formally submit this information as digital data.

In the tender process, the department advised prospective bidders that “we hold the intellectual property which would be made available to the appointed supplier”.

According to detailed specification documents: “The supplier must ensure BPT: retains its current look and feel for the customer; is maintained up to date with Apple accreditation and Windows code-signing certification; is developed in line with the RTI (real-time information) schema and annual new projects accommodated…; supports payroll and RTI reporting capability for the current tax year and previous six tax years; calculates and records the employers PAYE bill, taking account of any reliefs; is available, fully tested and supported for all major operating systems including, but not limited to, Apple-Mac, Linux and Windows, including the buyer’s desktop platform; retains automatic update facility; allows database back-ups and the ability to restore; remains GDPR compliant; meets required accessibility standards… ; [and]  is developed and tested from an anti-virus (AV) viewpoint… as compatible with as many known AV software products as possible.”