Businesses worry legislative tax burden is increasing

The annual report from the Administrative Burdens Advisory Board (ABAB) shows a slight improvement in HMRC’s performance but there is a rising concern over legislative burden and continued difficulties with communication channels.

The ‘Tell ABAB report 2025 to 2026’ represents the views of the small business community and provides detailed research to HMRC on their policies and procedures.

Legislative burden and impact

One highlight of the report was the growing concern that complying with the tax rules was becoming increasingly unwieldy. A significant 61.6% of respondents said the legislative burden had worsened over the last 12 months, with 62.8% saying they had been impacted by legislative changes.

MTD

There was a more positive perception of Making Tax Digital (MTD) for Income Tax than last year, although only slightly. Respondents said that MTD was expected to have less impact on cost and time than reported in 2025, with approximately 43% saying it would have no significant effects compared with 27% in 2025.

In spite of this, 27.2% still expected to incur significant costs. The vast majority of respondents (60.1%) felt that there are no benefits to MTD for Income Tax, a view broadly in line with the opinions reported in 2025 (65.2%).

It is worth noting that the survey was carried out before the first filing deadline for those mandated to use MTD for Income Tax from April 2026.

HMRC communications and guidance

For the last few years, HMRC have received poor scores on their communications. This year, satisfaction levels for telephone and webchat services have gradually increased, but they still receive a mixed feedback.

Across all services, except for the HMRC app, the largest group of respondents continued to rate usefulness as ‘poor’. Fifty-five per cent regarded the telephone service as poor, along with 46% for the webchat service.

The largest group of respondents for the HMRC App service rated it as ‘average’.

Regarding HMRC’s guidance documents, 31.3% felt that it was helpful, with only 14.4% considering it unhelpful.

Most startling were the responses from those who had started a business in the last 12 months. An overwhelming 72% of those respondents said the guidance did not help them complete their task (an increase from 56.6% in 2025).

Customer experience

The majority of respondents said their experience with HMRC over the last 12 months had not changed. Only 6.0% remarked that their customer experience had improved, while a substantial 31.4% said it had worsened.

Taxpayers continued to find helpline responses not up to scratch, with 47.2% saying that response times were poor, although this improved by 8.3% from 2025.

Only 3.9% of respondents rated the response times as very good.

AI use

The ABAB found that the use of generative AI for tax queries continued to rise. 32.4% reported having used systems such as ChatGPT or CoPilot to seek an answer to a tax query, up from 10.9% in 2025.

Worryingly, 61.1% felt they received an answer which resolved their query, although 7.2% of those then reported that the answer was, in fact, not reliable.

The survey had a record 10,195 responses, up from 3,146 last year. 88% of responses came from businesses and 12% from agents.

If you have issues communicating with HMRC or need help with their guidelines, please contact us; we’re here to help.