HMRC has published a package of tax and customs announcements aimed at reducing administrative burdens, improving certainty and making the UK tax system easier to navigate.
The measures sit under the government’s wider tax update for 2026: simplification, modernisation and fairness agenda and are relevant to a broad range of businesses, from property developers and housing providers to importers, exporters, freight agents, software developers and businesses preparing for more digital tax administration.
One of the most significant announcements is a consultation on introducing a new zero rate of VAT for the sale of land intended for the construction of new social housing. At present, VAT can add complexity and cost to land transactions, particularly where developers, landowners and housing associations are trying to bring forward viable schemes. The proposed relief is intended to support the delivery of new social housing by reducing barriers within the tax system and helping more projects progress. HMRC and HM Treasury are seeking views on how the current rules work in practice, how the new relief should be designed, and how safeguards can ensure the measure remains fair and affordable. The consultation will be especially important for housing associations, residential developers, landowners, construction businesses, tax advisers and representative bodies.
HMRC has also launched a call for evidence on modernising the UK customs regime. This seeks input on how international trade is changing, how digitalised business operations affect customs data, and whether the current approach to customs authorisations is fit for the future. The review is likely to be of particular interest to importers, exporters, freight forwarders, hauliers, customs intermediaries, logistics businesses, trade bodies and customs software providers. While the call for evidence is not focused on day-to-day service issues, it does point to a longer-term direction of travel: a customs system that better reflects modern commercial practices, digital records and the way goods move across borders.
The wider Tax Update 2026 paper also confirms a number of projects designed to simplify and modernise tax administration. A key announcement is the government’s intention to use the Peppol framework for e-invoicing, which will be relevant to software developers, larger businesses, finance teams and, in time, smaller businesses as digital invoicing becomes more closely connected with tax compliance. The update also covers other areas of reform, including reviews of Benchmark Scale Rates and Overseas Scale Rates, consultations on more timely payments for Income Tax Self Assessment, and broader measures intended to make it easier for taxpayers to get their affairs right first time.
For businesses, the announcements should be seen as more than isolated technical changes. They form part of HMRC’s continued move towards a more digital, data-led and automated tax and customs environment. That creates opportunities to reduce friction and improve certainty, but it also means businesses will need to keep their systems, processes and records under review. Property and construction businesses may wish to consider whether the proposed VAT relief could affect future land transactions or social housing projects. Businesses involved in international trade should consider whether the customs call for evidence gives them an opportunity to highlight practical issues with current processes. Software providers and finance teams should also begin thinking about how e-invoicing through Peppol could affect future reporting, billing and compliance workflows.
Although many of the proposals remain at consultation or evidence-gathering stage, early engagement could be valuable. Responding to HMRC consultations can help shape the practical detail of new rules before they are finalised, particularly where draft measures may have unintended commercial or administrative consequences. Businesses should also use this period to assess whether their tax governance, accounting systems and customs procedures are ready for the direction of travel.
If you may be affected by the proposed VAT treatment of land for social housing, the customs modernisation review or the move towards e-invoicing, please speak to your usual Hillier Hopkins adviser. We can help you assess the potential impact, identify areas for action and, where appropriate, support you in preparing a response to HMRC.
