Creative Takeaways
- What Is HMRC? – HMRC (His Majesty’s Revenue and Customs) is the UK’s tax authority, collecting and managing taxes while funding schools, healthcare, and infrastructure.
- It is staffed by a diverse workforce of inspectors, accountants, lawyers, and specialists.
- HMRC goes beyond taxes, enforcing the minimum wage, handling student loan repayments, and managing customs.
- It also provides financial support, such as Child Benefit, tax credits, and crisis schemes like furlough.
- Core taxes managed include Income Tax, VAT, Corporation Tax, Capital Gains Tax, Inheritance Tax, Stamp Duty, Excise Duties, and Customs Duties.
- Not every HMRC letter means trouble—many are reminders, updates, or confirmations.
Wonder how HMRC defines itself? Well, search no more, because they gave us a video that you can check out right here:
Table of contents
1. What is HMRC?
His Majesty’s Revenue & Customs – HMRC for short – is the UK’s tax authority.
It’s the government department that makes sure tax rules apply fairly across the country, and that the money collected goes back into public services like healthcare, schools, and infrastructure.
HMRC isn’t only about collecting income tax or chasing your VAT. This organisation makes sure the system runs smoothly so that families, businesses, and communities all get the support they truly need. You can think of it as the financial backbone of the UK.
2. Who make up HM Revenue and Customs?
Behind the name HMRC is a huge team of people.
It’s not just tax inspectors and number-crunchers. You’ve got accountants, lawyers, policy experts, project managers, and thousands more specialists, who all work towards the financial stability of the UK.
Don’t think that HMRC is a faceless machine! It’s made up of people just like you, and they’re all working to keep the system fair, up-and-running, while helping businesses stay compliant with all the rules in place. On top of that, they even make sure individuals receive the support they’re entitled to.
3. What HMRC does beyond taxes
Most people know HMRC for tax:
- income tax
- VAT
- corporation tax
- PAYE
and many more…
But that’s only part of the story. HMRC also looks after areas you might not expect.
It checks that employers pay at least the National Minimum Wage. It collects student loan repayments when graduates start earning. And it helps UK businesses trade more easily overseas by managing customs and import rules.
So even if you’re not filing a tax return yet, chances are HMRC already has a role in your day-to-day life.
4. How HMRC supports society
HMRC isn’t just about taking money IN – it’s also about paying money OUT where it’s needed.
Every year, millions of families receive Child Benefit and tax credits that help with the cost of raising children.
Some taxes are designed to change behaviour, not just raise revenue. The Plastic Packaging Tax and the Landfill Tax are both collected by HMRC to encourage recycling and reduce waste.
And when a crisis hits, HMRC steps in. During the COVID-19 pandemic, it supported more than 11 million workers by helping employers cover wages through furlough schemes.
| The real-world challenges of HMRC While HMRC plays a vital role in keeping the UK’s finances on track, it isn’t without its challenges. Like many large organisations, it operates with limited resources and varying levels of training across its staff. That means your experience can sometimes depend on who you deal with, and even seasoned accountants can find the process frustrating. It’s worth keeping this in mind: HMRC is made up of individuals and systems, some more effective than others. Being aware of this can make it easier to remain patient and highlight the importance of professional guidance for complex matters. |
5. Why HMRC matters to you as a sole trader or business
Even if you’ve never thought much about taxes, HMRC will cross your path sooner or later.
If you’re a student, it collects your loan repayments. If you’re employed, it makes sure your PAYE tax is taken correctly. If you run a business, HMRC is where you deal with VAT, corporation tax, and payroll.
And if you’re a parent, HMRC is the one paying out Child Benefit. In one way or another, it touches nearly every household in the UK.
That’s why it pays to understand the basics of what HMRC does. It makes the letters and forms feel a lot less intimidating when they eventually land on your doorstep.
6. HMRC’s core tax duties
At its core, HMRC is the guardian of the UK’s tax system.
Its job is to make sure taxes are collected fairly, and that money flows back into schools, hospitals, infrastructure, and the benefits system.
Here are the main taxes HMRC oversees:
- Income Tax – paid on wages, pensions, and certain savings and investments.
- National Insurance contributions – funding the State Pension, maternity pay, and other benefits.
- VAT (Value Added Tax) – charged on most goods and services bought in the UK.
- Corporation Tax – paid by companies on their profits.
- Capital Gains Tax – on the profit from selling assets such as property, shares, or valuable items.
- Inheritance Tax – charged on estates above a certain threshold when someone dies.
- Stamp Duty Land Tax – paid when buying property or land.
- Excise Duties – applied to alcohol, tobacco, and fuel.
- Customs Duties – collected on certain imports and exports.
- Insurance Premium Tax – paid on general insurance policies.
- Air Passenger Duty – added to the cost of most flights departing from UK airports.
These taxes account for most of the UK government’s revenue. If you’re employed, self-employed, running a business, or buying property, HMRC is the body that makes sure the rules apply consistently.
If you feel like you want to learn more about what is HMRC, and how it works with taxes, you could also ask an accountant… like WallsMan Creative! We’ve been doing business for more than 10 years now, and our expertise lies with the creative sectors: whether you’re a photographer, a writer, a design studio, or you have your own tech company, it doesn’t matter – we know the ins and outs of what you need to ace it in business!
7. Clearing up confusion around HMRC letters and warnings
One of the biggest worries people have about HMRC is when a letter arrives in the post.
It’s easy to panic, but not every HMRC notice means you’re in trouble! 😉
Common reasons HMRC writes to you include:
- A reminder about Self Assessment deadlines
- Updates on your tax code or PAYE
- Confirmation of Child Benefit or tax credit payments
- Notices about underpaid or overpaid tax
Recently, searches have spiked around the “HMRC warning on savings accounts.”
These warnings usually highlight potential scams or explain how interest on savings is taxed. If you get a message claiming to be from HMRC about your savings, always check it carefully. HMRC will never ask for your bank details or request payment over text or email.
You can read more about HMRC scam calls and HMRC phishing emails on our site.
8. Use HMRC online services with an accountant
To summarise, HMRC is more than just the taxman. It collects the money that keeps the UK running, but it also pays out benefits, protects workers, supports families, and funds public service we all rely on. And if you already understand what is HMRC, maybe you can learn the basics about what is tax.
If you run a creative business in the UK and want clarity around your taxes, WallsMan Creative specialises in helping people like you deal confidently with HMRC. With the right support, managing your accounts becomes much simpler. Use HMRC online services with an accountant to its full potential!
