TL;DR
- HMRC funds voluntary and community sector organisations to support individuals navigating tax system changes.
- The current priority is Making Tax Digital for Income Tax, targeting digitally excluded and underrepresented groups.
- Eligible organisations include charities, community groups and social enterprises working with self-employed people and landlords.
- Funding covers awareness and education activities, not regulated tax advice.
- The programme runs into the 2026-27 and 2027-28 financial years.
What Is the HMRC Voluntary Sector Funding Programme?
HMRC operates a grants programme for voluntary and community sector organisations to support tax and benefit education among groups that are less likely to engage directly with HMRC communications. The programme funds trusted intermediary organisations to deliver guidance, workshops and support services to their existing audiences.
The current funding round is linked to the rollout of Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA), which requires self-employed people and landlords with gross income above relevant thresholds to keep digital records and submit quarterly updates to HMRC from April 2026 onwards. Phase 1 applies to those with gross income above 50,000 pounds from April 2026. Phase 2 extends the requirement to those with income above 30,000 pounds from April 2027.
HMRC has identified that some groups are at higher risk of non-compliance due to lack of awareness or limited digital capability, and the voluntary sector programme is designed to address this through trusted community channels. The programme has historical precedent across a range of HMRC campaigns, including previous rounds covering changes to tax credits, self-assessment registration and the introduction of Making Tax Digital for VAT.
Who Is Eligible to Apply?
The funding is open to registered charities, community interest companies, community benefit societies and similar non-profit organisations operating in England, Scotland and Wales. Organisations must have an existing relationship with a target audience that includes self-employed individuals, landlords, small business owners or people who receive income from multiple sources.
Organisations working with communities that are underrepresented in HMRC engagement, including migrant communities, older workers, disabled people and those in rural or deprived areas, are particularly encouraged to apply. HMRC assessors look for evidence of reach, organisational capacity to deliver, and the ability to report on outcomes against agreed metrics.
Organisations that have previously received HMRC voluntary sector funding and delivered successfully against their grant objectives are eligible to reapply. A strong track record of delivery is a positive factor in the assessment process. Organisations applying for the first time should focus on demonstrating the depth of their relationship with the target audience and their experience of delivering similar education or engagement programmes.
What Activities Does the Funding Cover?
The funding supports awareness-raising and education activities rather than regulated tax advice. Funded activities typically include workshops explaining what MTD for ITSA means for self-employed people and landlords, guidance on finding and using compliant software, signposting to HMRC digital services and helplines, and production of accessible materials in community languages.
Organisations are not funded to provide individual tax advice or to complete tax returns on behalf of beneficiaries. Where beneficiaries need regulated advice, organisations are expected to signpost them to appropriate professional advisers or HMRC services. Digital inclusion activity is specifically encouraged in the current round, including basic digital skills support to help beneficiaries access online HMRC services and understand how to use MTD-compatible software.
Funding Amounts and Grant Periods
HMRC does not publish standard grant amounts. Grant sizes are determined by the scope of the proposed activity, the number of beneficiaries to be reached, and the organisational capacity of the applicant. Grants have historically ranged from a few thousand pounds for small local projects to larger awards for organisations with national reach.
The current funding round covers activity in the 2026-27 and 2027-28 financial years, aligned with the phased implementation of MTD for ITSA.
How to Apply
HMRC publishes funding opportunities on its website and through the GOV.UK grants finder. Voluntary sector organisations should monitor the HMRC website and sign up for HMRC Stakeholder Digest and Agent Update emails to be notified when funding rounds open.
Applications typically require a description of the organisation and its existing work, a clear explanation of the target audience and the barriers they face in engaging with tax system changes, a proposed activity plan with measurable outputs and outcomes, a budget breakdown, and evidence of organisational capacity and governance. Concision is valued over length in most sections.
Organisations that have not previously engaged with HMRC may wish to make initial contact with the HMRC Stakeholder Engagement team ahead of a formal application to understand the priorities for the current round. HMRC also runs sector briefing events ahead of funding rounds where prospective applicants can ask questions directly.
Reporting and Accountability
Organisations receiving funding are required to submit progress reports and a final grant report setting out the activities delivered, the number of beneficiaries reached, and evidence of impact. HMRC uses this data to assess the effectiveness of the programme and to inform future funding rounds. Organisations that fail to deliver against their grant objectives or to report satisfactorily may find this affects their eligibility for future rounds.
Frequently Asked Questions
Can a small local charity apply for HMRC voluntary sector funding?
Yes, provided the organisation has charitable or community status, works with people affected by relevant tax changes, and has the capacity to deliver and report on funded activities. Grant sizes are scaled to the scope of activity proposed.
Does the funding cover staff costs?
Most HMRC voluntary sector grants can include a proportion of staff time directly attributable to funded activities. The specific rules on eligible costs are set out in the grant terms and conditions for each funding round.
Is the funding only for Making Tax Digital?
The current priority is MTD for ITSA awareness, but HMRC voluntary sector funding has historically covered a broader range of tax education topics. Organisations with relevant existing programmes should check the current round criteria when applications open.
Where can I find out when the next funding round opens?
Monitor the HMRC website at gov.uk/hmrc and the GOV.UK grants finder. Subscribing to HMRC Stakeholder Digest and Agent Update emails is the most reliable way to be notified of new opportunities.
Sources: HM Revenue and Customs | GOV.UK Find a Grant | Making Tax Digital for Income Tax
