Increasing on-time tax payment at scale

HMRC

The problem

Her Majesty’s Revenue & Customs (HMRC) faced a persistent challenge with citizens paying their taxes late, creating avoidable administrative burden and delaying public revenue. Traditional approaches such as reminders, warnings, and the threat of penalties were not reliably shifting behaviour among late payers. A solution was needed that could improve compliance quickly, at scale, without adding cost or complexity to existing processes.

The  solution

INFLUENCE AT WORK designed a behavioural experiment that tested alternative letter wording using proven principles from the psychology of persuasion. Different message frames were trialled and responses were measured to identify which approach most effectively prompted action. The strongest result came from a clear and relatable social norm message that highlighted that most people pay on time and positioned late payment as an outlier behaviour.

The impact

The intervention generated an additional £230 million in cash to bank revenue, as calculated by the National Audit Office at no additional cost. The results demonstrated that small changes to behavioural cues in official communications can deliver substantial improvements in real-world compliance at national scale. The work was featured as a lead article in Harvard Business Review.

“Working with IAW was a turning point for how HMRC approached late payment communications. They brought a rigorous, evidence-led approach, but kept the focus on practical changes that could be implemented quickly within existing processes. The impact achieved through a simple, low-cost intervention was significant, and the project has strengthened internal confidence in using behavioural science to improve compliance in a measurable, accountable way.”

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