What is HMRC?
His Majesty’s Revenue and Customs, or HMRC, is the part of the government that manages most taxes. They both collect them and assess what’s due.
The taxes can relate to individuals, such as Income Tax and National Insurance, or they can relate to businesses, such as Corporation Tax.
The other main taxes HMRC collects are VAT, excise duties, customs duties (including fuel), inheritance tax, capital gains tax, and property sales tax (Stamp Duty). Notably, it doesn’t handle Council Tax and Business Rates, which are collected and managed by local authorities.
It is also responsible for the Making Tax Digital initiative, which has been rolled out for VAT and Income Tax. It manages some personal financial support systems, too, like child benefit and tax credits. It’s responsible for other top-level government initiatives like anti-money laundering supervision (AML) and trade statistics.
HMRC was created in 2005 when the centuries-old Inland Revenue merged with HM Customs and Excise. For this reason, people sometimes informally refer to HMRC as “the Revenue”. However, this is incorrect.
Subscribe to the Sage Advice newsletter
Join more than 500,000 UK readers and get the best business admin strategies and tactics, as well as actionable advice to help your company thrive, in your inbox every month.
