There has been a substantial rise in the number of people using a simpler way to pay their tax bill ahead of the self-assessment deadline on 31st January. Taxpayers are increasingly using Pay by Bank technology to send money to His Majesty's Revenue and Customs (HMRC).
Pay by Bank uses financial technology to allow you to make secure account to account payments between banks. Using it means taxpayers do not have to manually enter as much sensitive financial information. The payment method is based on open banking APIs and banking infrastructure. Using Pay by Bank has several benefits including making payments simpler for taxpayers, decreasing payment errors, improving operational efficiency, and reducing the overall costs per transaction.
Taxpayers paid more than £12 billion to HMRC using Pay by Bank between 1st February 2024 and 20th January 2025. This is a significant 36% increase from the same period in the previous year. The figures have been provided by Ecospend, a Trustly Company that provides Pay by Bank solutions to HMRC. The tax authority recently awarded Trustly’s Ecospend a new contract to continue to provide these solutions.
More than 3.6 million Pay by Bank transactions were made by taxpayers to HMRC during the period. This is a 28% increase from the previous year.
1st Feb 2023 - 20th Jan 2024 1st Feb 2024 - 20th Jan 2025 Growth YoY
Number of Pay by Bank tax payments 2.8 million 3.6 million 28%
Value of Pay by Bank tax payments £8.9 billion £12 billion 36%
January is typically the most popular month for self-assessment tax payments. In the first 20 days of January 2025, taxpayers sent more than £1.7 billion to HMRC using Pay by Bank in over 500,000 transactions. This is a 39% increase in the value of Pay by Bank transactions from the £1.2 billion sent in the first 20 days of 2024.
Around 12 million people are expected to submit a self-assessment tax return for the 2023 to 2024 tax year before the 31st January 2025 deadline. HMRC has produced a step-by-step guide to check what customers need to do to file their first tax return.
Johan Tjärnberg, Group Chief Executive of Trustly, said: “It is fantastic to see the substantial increase in people using Pay by Bank. The technology is designed to make it quicker and easier to pay taxes. Using Pay by Bank means you enter less information manually, so there is less chance of mistakes. The technology also makes payments more efficient and reduces costs per transaction .
“HMRC’s use of Pay by Bank is one of the most innovative examples of embedding fintech within a Government, setting a global standard. The tax authority is able to provide a simple, fast, and secure payment experience with Pay by Bank. We hope to see further use of Pay by Bank in other Government Departments to help speed up and simplify payments and reduce costs to the public sector.”