As the department works on a major new suite of services for those whose income tax is deducted directly from their pay cheque, a supplier has been retained to assist

HM Revenue and Customs has awarded a seven-figure deal to help the department create a new online tool through which 35 million pay-as-you-earn taxpayers will be able to manage issues related to their professional expenses.

Last summer, HMRC published a Transformation Roadmap setting out a range of digital and data commitments for the coming months and years – including a pledge that, by the end of 2026, it would “roll out a new online service for all PAYE taxpayers – around 35 million [people] – giving people direct access and control over their tax position”.

Including within this new offering will be “a new expenses service to enable PAYE customers to submit claims for tax relief on their allowable expenses and upload supporting evidence all in one place”, the roadmap added.

As of 1 April, the tax agency has entered into a seven-month contract with tech consultancy Coforge. The deal – which is value at £1.49m – concerns “PAYE expenses delivery support” to complement the work of the department’s own digital experts.

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A newly published contract notice says that the India-headquartered IT supplier has been retained “to provide specalist capabilty to support the development of HMRC’s digital customer-facing services as part of the digital modernisation programme” being undertaken.

The commercial document adds that the contract was awarded via the £3bn Digital and Legacy Application Services framework – which was created in 2023 with the primary purpose of supporting HMRC service transformation and upgrades of ageing systems.

As well as a new online tool through which citizens will be able to manage matters related to expense submissions, “HMRC is also improving the way PAYE expenses are claimed using pre-populated data and document uploads to verify claims and reduce fraud”, according to the department’s roadmap.

Six months ago, the organisation claimed that a trial of “digital nudges” reminding taxpayers of how to correctly classify their business expenses has generated an additional £27m of income for the Exchequer.