Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

This week's opinion: 25 January 2024

22 January 2024 / Andrew Hubbard
Issue: 4921 / Categories: Comment & Analysis
Reliability of future MTD systems is essential

I suspect that, like me, many of you will have been following the Post Office Horizon scandal. I had read the key cases and Nick Wallis’s book on the subject The Great Post Office Scandal, but there is nothing like seeing the drama played out on screen to appreciate the enormity of what went on.

Inevitably the whole affair has put renewed focus on all major government IT projects and, of particular relevance to us, yet again raises questions about the future of making tax digital (MTD). I am not one of those calling for its abandonment. It is clearly right that HMRC looks at the way that digitalisation can improve the administration of the tax system and, besides, too much has already been invested in the project for it simply to be abandoned.

But what Horizon has shown is the critical importance of transparency, accountability and reliability. Postmasters had nowhere to go when problems arose. There was an assumption that the computer must have got it right and that errors were the result of deliberate actions by postmasters stealing money from the system. The most obvious read across to MTD is error correction. If a taxpayer relies on a pre-populated figure in a return which is not correct, where does responsibility lie? What happens when a computer makes an error? In legal proceedings how much reliance can be put on computer-generated printouts? Can taxpayers overwrite what a computer has produced?

These are complex issues and we certainly don’t have all of the answers yet. It would be wrong to suggest that MTD will be the next Horizon, but that doesn’t mean that there couldn’t be problems down the line. An open dialogue is essential.

If you do one thing…

See HMRC’s updated guidance on how to get authorised as a tax agent (

Issue: 4921 / Categories: Comment & Analysis
back to top icon