HMRC Launches 10-Year, £175 Million AI Initiative to Combat Tax Fraud and Errors

HM Revenue and Customs (HMRC) has embarked on an ambitious 10-year journey to enhance its operations by signing a £175 million deal with UK-based technology company Quantexa. This landmark agreement seeks to harness artificial intelligence (AI) to detect fraud and address tax errors more efficiently, following over 93,000 complaints in the 2024/25 financial year.

Quantexa’s AI-powered platform will integrate HMRC’s internal data with external sources, creating a comprehensive, connected view that accelerates the identification of fraudulent activity and unintentional mistakes. By transforming fragmented data into actionable insights, this collaboration aims to strengthen HMRC’s ability to protect public revenues and improve overall service.

Vishal Marria, Founder and CEO of Quantexa, emphasizes the global challenge of converting complex, dispersed data into reliable decisions: “By creating context from data and embedding trusted, governed AI, we are helping HMRC improve how public sector organizations make confident, informed decisions. This is a blueprint for how the UK government deploys AI at scale.”

The initiative also supports the modernization of HMRC’s data infrastructure, enabling advanced AI capabilities that will contribute to closing the tax gap and delivering faster, more seamless customer experiences. This move is seen as a critical step toward enhancing transparency and effectiveness in tax administration.

According to Freedom of Information data obtained by the Contentious Tax Group, complaints against HMRC surpassed 93,000 during the latest financial period, highlighting the need for transformational change.

Quantexa’s Decision Intelligence Platform is designed to unify disparate data into a trusted, governed foundation that ensures auditability and control while supporting AI governance and explainability. As governments worldwide face challenges related to data sovereignty and aging infrastructure, HMRC’s adoption of this technology sets a new standard for how unified data and AI can drive smarter, automated decision-making.