Income Tax Self-Assessment Penalty Reform
Source: gov.uk (2025-10-10)

HMRC's Income Tax Self-Assessment Penalty Reform alpha assessment

Service Standard reassessment report

Income Tax Self-Assessment Penalty Reform alpha assessment

Service description

This service aims to support users with a new digital platform, offering fairer, points-based sanctions for late submission of Income Tax Self-Assessment returns and more proportionate penalties for late payment of tax liabilities. The service will enable users to view, pay, and appeal their penalties while also helping them understand new penalty rules and compliance processes.

This service forms part of the HMRC ‘Penalty Reform’ programme aligned to the ‘Making Tax Digital’ programme which is the cornerstone of HMRC’s commitment to modernising the way small businesses handle their tax and reducing tax lost to error.

Service users

This service is for Individual taxpayers and/or their agents required to complete Income Tax Self-Assessment returns that have received penalties for late/non completion.

Things the service team has done well:

The team presented a coherent story of their service, it’s aims, and how it will meet user needs. They have completed an extensive Discovery and Alpha phase, having developed end-to-end services maps and prototyped the main journey which has been tested with users and is reusing established patterns used in VAT penalties and other Self-Assessment journeys.

Their user research had evolved through Discovery and Alpha, demonstrating a good understanding of users, their needs and the personas. The team are working closely with other teams, reusing established design patterns, sharing research insight and have a solid understanding of where the Penalty Points and Appeals service lives within the wider context of Making Tax Digital. They are using the existing HMRC platform effectively, reusing common patterns, and following established best practice technology decisions.

1. Understand users and their needs

Decision

The service was rated amber for point 1 of the Standard.

During the assessment, we didn’t see evidence of:

sufficient research to fully evidence the service works for everyone. The team have undertaken a long alpha phase but still have significant gaps in research. For example, with HMRC staff involved in the process and their ‘trusted helper’ persona. The panel was confident that the service team have sufficient time and capacity to address this before moving into Private Beta.

a responsive and creative approach to participant recruitment. There was no evidence of trying alternative ways of recruiting where standard methods like a paid-for recruiter had failed. selecting appropriate and robust research methods, including: focussing on remote interviews and prototype testing so should consider other methods for a comprehensive approach.

moving into prototype testing very early in alpha, after a short discovery, meaning it is unclear what other ways of solving the problem had been explored, and why this solution had been selected. using scenario testing and asking participants to ‘imagine they’re self-employed’ which can impact data validity. With over 12 million Self-Assessment returns expected in 2025 there is a very large user base that would have the experience needed to give direct feedback.

sufficient research with people with additional needs. This could be aided by the team’s plan to remove the blocker that prevents people using assistive technology accessing the prototype. research with potential/future users. It’s not yet clear whether the service meets the needs of people new to self-assessment.

2. Solve a whole problem for users

Decision

The service was rated amber for point 2 of the Standard.

During the assessment, we didn’t see evidence of:

the end-to-end user journey, including the parts either side of the Penalty reform microservice. Although not responsible for these parts of the journey they are essential to solving the whole problem. Prototyping the end-to-end will orientate the service within Income Tax Self-Assessment, for example, what happens to start the interaction and set the user up for success, and what happens after to complete the task. The team will gain valuable insight into the whole problem both for themselves and to contribute to teams either side of the Penalties service leading to a smoother transition through the end-to-end journey.

a user centred problem statement. The statement presented during assessment described a solution and how to deliver it, much like a statement of work as opposed to the problem faced by a user. Some references the team might find useful are The actual problem to be solved and How to write a problem statement.

3. Provide a joined-up experience across all channels

Decision

The service was rated green for point 3 of the Standard.

To continually improve the service, we suggest:

continuing to contribute insight and recommendations from their research to help shape outward facing communications. The team are part a much larger programme of work so do not have full control of content on GOV.UK or notifications sent to users in relation to penalties and appeals. This will ensure communications are meeting the needs of users of the service.

usability testing the end-to-end journeys, including the channels a user will interact with, to ensure the journey is coherent and helps users understand the new penalty rules, compliance processes and what to do next.

4. Make the service simple to use

Decision

The service was rated amber for point 4 of the Standard.

During the assessment, we didn’t see evidence of:

the user experience outside the Penalty and Appeals part of the journey. The team need to show they have considered the full journey from a user receiving a letter or notification about a penalty point, through login to a tax account, viewing the full notification then navigating to the penalty and appeals microsite. It wasn’t clear from the demo how View and Change featured as the entry point to Penalty and Appeals.

the team considering how Penalty and Appeals hands off to payments, so the user can resolve the whole problem.

keeping the Tag component up to date with GOV.UK patterns. The team needs to review use of the Tag component used to highlight the different states of the points and penalties. The current version of Tag published on the GOV.UK Design System uses both upper and lower case characters to improve readability and no longer uses white text to distinguish tags from buttons.

5. Make sure everyone can use the service

Decision

The service was rated green for point 5 of the Standard (https://www.gov.uk/service-manual/service-standard/point-5-make-sure-everyone-can-use-the-service).

To continually improve the service, we suggest:

completing the end-to-end accessibility assessment early planned for Private Beta sooner rather than later to provide confidence the microservice approach is not disadvantaging users of assistive technology.

during the assessment, the team shared the future roadmap for the Penalty and Appeals service which included incorporation into other parts of HMRC such as VAT. When designing a tax agnostic microservice, where entry points are different, the team will need to consider how the user arrives in their part of the wider service, so the context of the consuming service is maintained throughout the user journey to help with orientation and maintain trust.

reviewing the WCAG 2.2 standards which the microservice approach needs to address. Key points are 2.2.1 Timing Adjustable for session management and 2.2.4 Page Titled for consistent page title conventions to orient users. The Making microservices accessible blog offers excellent advice on how to approach this.