Performance Report

Performance Report

Introduction 

This performance overview serves as a summary to provide readers with a clear and comprehensive understanding of Revenue Scotland, our purpose, and our performance over the reporting period. This section summarises our strategic outcomes, our performance in relation to these outcomes, and the management of key risks.

The performance overview begins by detailing our key functions, our governance structure, before discussing our progress against the strategic outcomes outlined in our Corporate Plan 2021-24

Who we are and what we do 

Revenue Scotland was established under the Revenue Scotland and Tax Powers Act 2014 (RSTPA). We are responsible for the collection and management of the fully devolved Scottish taxes: Land and Buildings Transaction Tax (LBTT) and Scottish Landfill Tax (SLfT). 

As a Non-Ministerial Office, we are part of the Scottish Administration and we are accountable directly to the Scottish Parliament, ensuring the impartial and fair administration of taxes. The Scottish Government is responsible for tax policy and rates, while we provide policy development support through the provision of advice, data, and information based on our operational experience. 

We are proud to work alongside the Scottish Fiscal Commission (SFC), which is responsible for providing independent forecasts of tax revenue in line with the Fiscal Framework. To aid forecasting work, we provide anonymous, aggregated SLfT and LBTT data to the SFC. 

In addition to delegating specific functions for SLfT collection to the Scottish Environment Protection Agency (SEPA), we also collaborate with His Majesty’s Revenue and Customs (HMRC) for compliance activity. Furthermore, we actively participate in the British Isles Tax Authorities Forum, working closely with other tax authorities to share knowledge and best practices in tax collection and management.

How we are governed 

The Board is responsible for the strategic direction, oversight, and governance of the organisation. It currently comprises seven members appointed by Scottish Ministers through the Scottish Public Appointments process. Board members provide specialist knowledge in key areas and act as ambassadors for the organisation. 

The Board has two committees: the Audit and Risk Committee (ARC) and the Staffing and Equalities Committee (SEC), which provide direction, support and detailed scrutiny of key areas of work and report on these to the Board. The Chief Executive is accountable to the Board and acts in a personal capacity as the Accountable Officer for Revenue Scotland. The Chief Executive is responsible for the day-to-day leadership and operation of the organisation. 

Further details about the activities of the Board, committees, and staff can be found in the Accountability Report section of the Annual Report.

How we are structured 

Our Senior Leadership Team is led by the Chief Executive and includes the Head of Tax, the Head of Corporate Functions, and the Head of Legal Services. Reporting directly to the Chief Executive, our SLT are responsible for the operational leadership, and the direction and coordinating of the delivery of our strategic outcomes. 

Our organisational and team structure is depicted in the diagram on the following page, providing a visual representation of the Senior Leadership Team’s role within our organisation.

How we are funded 

Revenue Scotland is part of the Scottish Administration and our budget is set by the annual Budget Bill. The Scottish Government liaises with us to identify our budgetary requirements which are then reflected in the Budget Bill that Ministers present to the Scottish Parliament. Where additional funding for major programmes is required, proposals for funding are developed in line with the guidance on business cases in HM Treasury’s ‘The Green Book: appraisal and evaluation in central government’. 

We are responsible for managing our budget for each financial year to deliver our statutory functions. We have authority to incur expenditure on individual items, but this is subject to the limits imposed by the budget allocated by the Scottish Parliament and guidance from Scottish Ministers.

Revenue Scotland’s purpose and vision 

This year, 2023-24, was the final year in our current Corporate Plan – delivered from April 2021 until March 2024. The Corporate Plan 2021-24 outlined our purpose, vision, strategic outcomes and performance measures. These determined our priorities in raising revenue to support public services across Scotland in the most efficient and effective way.

Purpose 

To efficiently and effectively collect and manage the devolved taxes which fund public services for the benefit of the people of Scotland. 

Vision 

We are a trusted and valued partner in the delivery of revenue services, informed by our data, digital by design, with a high-performing and engaged workforce.

Corporate Plan 2021-24 strategic outcomes 

After nine successful years in operation, and collecting over £6 billion in tax revenue, we have continued to build our reputation as a leading and well-respected public body, delivering excellence for Scotland. 

This year marked the final stretch of our Corporate Plan for 2021-24, which focused on four strategic outcomes, as outlined below. These outcomes were the cornerstone of our efforts towards achieving our ambitions, ensuring we continued to progress and improve the services we offered. Our new Corporate Plan 2024-27 was laid in Parliament in March 2024, and includes a refreshed purpose, vision and new strategic outcomes.

Excelling in Delivery 

We offer user-focused services that are digital by design, and provide value for money, convenience and ease of use for internal and external users.

Investing in our People 

We are high-performing, outward-looking and diverse, and provide a great place to work as an employer of choice. Our staff are motivated and engaged, and we invest in their development and health, safety and wellbeing.

Reaching Out 

We are accessible, collaborative and transparent, keen to learn from others and to share our experiences and expertise.

Looking Ahead 

We plan and deliver change and new responsibilities flexibly, on time and within budget. We have a digital mindset, maximising the use of our data and harnessing new technology to improve our working practices and services.

How we deliver our purpose and measure our success 

Our purpose is delivered through the strategic outcomes in our Corporate Plan, with progress tracked using key performance indicators (KPIs) and milestones related to key project objectives. Our Business Plan details projects and initiatives supporting these outcomes, guiding team and individual goals. 

This structure ensures a direct connection between individual work goals and the strategic outcomes defined in the Corporate Plan. Our systematic method of managing performance underpins our ability to track and document progress throughout the organisation.

National Performance Framework 

The National Performance Framework (NPF) underpins the Scottish Government’s vision, setting out National Outcomes to measure progress towards its goals. Our Corporate Plan is aligned with these Outcomes, guiding our efforts to support those relevant to Revenue Scotland’s remit. 

Our Corporate Plan’s execution involves clearly defined objectives and deliverables, enacted through a detailed strategy that includes corporate, business, and team plans. We track our progress rigorously, with monthly and quarterly performance reviews. 

By collecting devolved taxes, we indirectly support all National Outcomes, and directly contribute to six specific areas: economy, environment, fair work and business, communities, human rights, and health. Our approach emphasises investment in our workforce, dedication to equality, diversity, and inclusion, and collaboration with various partners, all underpinned by transparency and accountability.

The following table shows which Revenue Scotland strategic outcomes are relevant to the various National Outcomes.

Key issues and risks

This corporate risk summary provides an overview of the key risks faced, their impact on delivering our strategic outcomes, and emerging risks that may affect future performance.

We have a Risk Management Framework that follows the best practices outlined in the Scottish Public Finance Manual (SPFM) and the Scottish Government’s Risk Management Guidance. This framework guides us in identifying, documenting, and scoring risks, assigning ownership, determining responses, and monitoring and reporting progress. We completed a review of this framework in 2023-24 to ensure it remains effective.

Managing and communicating potential threats and opportunities is key for meeting the goals in our Corporate Plan. Before taking any action, we thoroughly score and manage risks. The concept of ‘risk appetite’ — the level of risk we are willing to accept to achieve our objectives — helps create a shared understanding across Revenue Scotland and supports confident, risk-based decision-making. 

Throughout the year, the Audit and Risk Committee, together with staff and Board members, reviewed the corporate risk register with a focus on risk appetite. Looking ahead to our new Corporate Plan for 2024-27, we plan to conduct a full review of our corporate risks.

Performance summary 

Key projects 

Our Business Plan outlines key strategic projects for 2023-24, marking the final year of the Corporate Plan. These projects represent major investments or hold strategic importance, playing a crucial role in fulfilling the Corporate Plan’s objectives. As we conclude this period, the majority of our projects are either on schedule or have been successfully completed.

KPIs overview 

The Corporate Plan 2021-24 outlines our key performance indicators (KPIs) that track our progress and alignment with our goals. These KPIs are detailed in the Performance Analysis section of this Annual Report, with page references included for easy navigation. 

These KPIs reflect our operational effectiveness and adaptability to changes within the organisation, while broadening the scope of our performance assessment, to include areas such as equality integration and service user feedback.

Financial performance 

Resource accounts 

The figures given below are the final budget (revenue and capital) after adjustment in the Spring Budget review.

In 2023-24 revenue expenditure was £40,000 (0.5%) less than budget, and capital expenditure was on budget.

Devolved Taxes

The values for the tables on the previous page, page 24, are for tax returns and amendments submitted during 2023-24. They are adjusted for the value of LBTT and SLfT returns received during April and May 2024, which relate to the period up to March 2024. 

The tax returns submitted during 2023- 24 may include adjustments to returns originally submitted in previous financial years. 

However, unless these adjustments were received in April or May of the relevant financial period and therefore accrued into the financial statements of that year, these are accounted for in the year of receipt. 

The LBTT revenue raised is dependent on performance of both the residential and non-residential property markets within Scotland. The SLfT revenue raised is dependent upon categories and tonnage of waste deposited in landfill sites within Scotland. 

Independent forecasts of LBTT and SLfT revenue are published by the SFC. The SFC publishes forecast evaluation reports comparing outturn figures to Budget Act estimates, detailing the reasons for any differences observed. 

A summary of the tax revenue and our resource spend over the period 2019-24 is shown on pages 114-117 and this forms part of our Performance Report. 

Further information on the collection of the devolved taxes is given in the Annual Report and Accounts for the Devolved Taxes for 2023-24, which is published separately.

Performance against the Revenue Scotland Corporate Plan 

The Performance Analysis section serves as a detailed and comprehensive dissection of our Corporate Plan 2021-24. Its primary goal is to illuminate the objectives we’ve set to accomplish our four strategic outcomes. Within this section, we explore our ten key performance indicators (KPIs) and how they relate to each strategic objective. Throughout the Performance Analysis section, a meticulous evaluation of our performance in relation to each strategic objective and its respective KPIs takes place. 

Central to our operations is the Revenue Scotland and Tax Powers Act 2014 (RSTPA), which forms the bedrock of our legal framework. This legislation plays a pivotal role in guiding our endeavors and shaping our operational landscape. Additionally, for a concise overview of KPI outcomes, readers can refer to the performance summary provided.

Excelling in Delivery

Strategic Outcome: we offer user-focused services that are digital by design, and provide value for money, convenience and ease of use for internal and external users. The following KPIs measure our performance towards the Excelling in Delivery Strategic Outcome. 

• KPI 1: Tax collection rate
• KPI 2: Response to user requests
• KPI 3: Tax compliance activity
• KPI 4: Administrative cost of collection.

To achieve this, we have the following objectives: 

• use technology, data and innovation to develop and enhance our tax collection systems and guidance
• adopt continuous improvement processes to make our services more effective and easier to use
• use our statutory powers appropriately to help taxpayers get to the right tax position
• seek to resolve disputes and pursue non-compliance by using our powers proportionately
• develop options for measuring and addressing tax receipt shortfall
• design and deliver systems that are compliant, reliable, efficient and cost-effective
• undertake effective management of assets through their lifecycle
• exemplify best practice in the ways we hold and manage data
• use our expertise in collecting devolved taxes to help shape the development of tax policy and legislation
• design and deliver public services that meet the diverse needs of our users
• include environmental impact as a key principle in our service delivery model
• meet our obligations as a public body and embed the management and mitigation of risk in our planning activities and operations.

The following section, starting with Tax Revenue, details our journey towards “Excelling in Delivery” and achieving this strategic outcome. This section explains how we have connected our strategic outcomes to our KPIs and provides a picture of what we have accomplished and how it ties into our overall success as a modern public body.

Tax revenue

Tax revenues decreased in 2023-24 after a record high in 2022-23. This was driven by a reduction in Residential LBTT revenues, due to a fall in the number of residential transactions, as well as a decrease in SLfT revenues arising from reduced volumes of waste going to landfill. However, revenues were still relatively high compared to pre-pandemic levels. According to KPI 1, our tax collection rate for 2023-24 stood at 99%, consistent with the benchmarks set in 2017-18, 2021-22, and 2022-23. Our service efficiency is evident in KPI 4, which highlights the minimal administrative cost of tax collection. For 2023-24, the collection cost was 0.87%, meeting our set benchmark.

Guidance, advice and support 

The service we provide to taxpayers is central to our core mission. One of our key performance indicators, KPI 2, is a measure of our response times to various service user requests, including phone calls, written correspondence, and the processing of tax repayment claims. We are proud to report throughout 2023-24, we consistently met our ambitious target of a 95% on time response rate – achieving our target for all three years of this Corporate Plan period. 

In 2023-24 we introduced a new LBTT relief, Green Freeports. Green Freeport relief is a tax incentive available for transactions involving land within designated Green Freeport zones, which are large, strategically located areas connected by rail, sea, or air. These zones aim to promote regeneration and job creation, and support the transition to a net-zero economy. The relief from LBTT can be full or partial: full relief applies when at least 90% of the transaction’s value pertains to qualifying land within a Green Freeport, and partial relief applies when at least 10% of the transaction’s value does. 

To support the introduction of this new relief, we introduced new guidance pages, updated existing guidance and delivered webinars which had over 60 attendees. 

A further 2024-25 guidance project plan is now in place for further LBTT pages to be updated. We regularly review any service user feedback on website guidance, acting on this where appropriate.

Ahead of the ADS legislative changes introduced on 1 April 2024, we updated our guidance to support taxpayers to understand the changes being introduced. YouTube videos were also produced. A webinar was delivered to agents followed by a question and answer session to raise awareness and knowledge and attracted over 300 participants. As a result of the webinar we were also invited to present at the Edinburgh Conveyancing Forum. 

SETS was enhanced and will provide users with the appropriate guidance based on the effective date entered into the system. 

Our SLfT team continued to meet regularly and work closely with landfill operators and other industry stakeholders to provide clarity on operational and technical tax matters. 

These initiatives support in achieving our Excelling in Delivery objectives by demonstrating our commitment to using technology, data, and innovation to enhance our tax collection systems and guidance. By adopting continuous improvement processes, we make our services more effective and easier to use, ensuring we meet the diverse needs of our users. Furthermore, our efforts in regularly updating and reviewing guidance reflect our dedication to best practices in data management and our role in shaping tax policy and legislation. 

Through these actions, we not only comply with our obligations as a public body but also weave risk management and mitigation into our planning activities and operations. This approach ensures we design and deliver systems that are compliant, reliable, efficient, and cost-effective.

LBTT: 3-Yearly Lease Reviews 

Leaseholders are required to submit a further tax return every 3 years throughout the duration of their lease. This area of work has proved to be challenging to achieve the levels of understanding and therefore compliance by taxpayers. It is for this reason that we set up a project with the aim of driving up return rates. During 2023-24 we have continued to enhance the three-yearly lease review process for LBTT. More improvements were made to our tax collection system (SETS) and further enhancements will be deployed throughout the next Corporate Plan period. These changes will make the process of submitting a return easier for both taxpayers and agents. 

During 2023-24 we have continued to enhance the three-year lease review process for LBTT. More improvements were made to our tax collection system (SETS) and further enhancements will be deployed throughout the next Corporate Plan period. These changes will make the process of submitting a return easier for both taxpayers and agents. 

The Lease Improvement project team continued to implement enhancements across three work strands: Data, Digital, and Communication and Engagement. From 2023-24, more communications are issued to taxpayers to remind them of their lease review return obligations. This includes an email sent to taxpayers on submission of any lease return. The email reminds taxpayers of their ongoing obligations and provides links to the relevant guidance. The quantity of reminder letters sent to taxpayers as the three-year review point is approached has also increased.

Communications were redesigned using a reading tool to make letters accessible and inclusive. We also hosted a webinar for agents and SETS users to increase their lease knowledge and highlight common errors we are seeing from tax returns. A question and answer session was held and the webinar can be accessed in our YouTube channel to provide ongoing support. 

Several changes were made to SETS during 2023-24. Examples include validation to ensure the submitted return is linked to the original return, pre-population of the tax return for ease of completion, locked fields in areas where the information cannot change and an alert for returns that appear to be non-notifiable. 

These initiatives demonstrate our commitment to using technology, data, and innovation to enhance our tax collection systems and guidance. By adopting continuous improvement processes, we make our services more effective and easier to use, ensuring taxpayers and agents can efficiently fulfil their obligations.

Digital & Data 

In 2023-24 we continued our programme of work to elevate our digital and data capability to ensure we are making the best use of technology and analytics to inform our operations and to support the introduction of new devolved taxes. In July we recruited a Head of Data & Digital to lead this work and create a new digital and data strategy to align with the Corporate Plan period. 

This role leads an expanded Digital and Data function across our organisation, encompassing the existing Information Technology, and Statistics and Management Information teams, and will bring in additional digital roles in 2024-25 to build our internal capability and help us work more effectively with our suppliers. 

The strategy sets out a vision of a single end-to-end digital tax service by 2026-27, where every interaction with a taxpayer or interaction through the entire tax journey will be available in a single view. 

Capital Investment Programme 

The Capital Investment Programme Board oversees the effective management and delivery of the Capital Investment Programme. The programme is well-established, with a remit to identify and monitor all the digital and data priorities outlined in our Corporate Plan.

Throughout the 2023-24 fiscal year, in close collaboration with our suppliers, our programme focused on five key areas of activity, each aimed at enhancing efficiency, accuracy, and user experience across our digital platforms: 

Improved search functionality for external users: 

we optimised indexing within our system to significantly enhance search speed and efficiency. Furthermore, we introduced advanced filtering options to refine search queries, providing users with greater precision in their search results. We also ensured compatibility with a wide range of search parameters and criteria, enhancing the overall user experience and facilitating seamless navigation through the platform. 

New functionality for lease review returns: 

we have successfully developed and implemented a validation process for tenant details, ensuring data accuracy and integrity. Additionally, we have deployed automated data extraction techniques for lease review returns, streamlining pre-population processes to enhance efficiency. Through these efforts, we have diligently maintained the accuracy and reliability of pre-populated data, further strengthening our data management practices. 

Improved validation on Portal: 

we have implemented significant enhancements to our input validation mechanisms aimed at preventing errors and upholding data integrity. Real-time validation feedback is now provided during data entry, ensuring immediate identification and correction of any issues. Additionally, clear and informative error messages have been integrated to guide users through validation challenges, further enhancing the accuracy and reliability of our data.

Portal text enhancements: 

we undertook a review of the text content within our portal, identifying areas for enhancement to improve clarity, readability, and consistency. Subsequently, we diligently addressed and implemented these updates, ensuring uniformity in terminology and messaging throughout the platform. Our efforts were bolstered by incorporating valuable user feedback to enhance content relevance and meet compliance requirements effectively. 

Letter automation: 

we have developed a robust system for automated letter generation, which includes the implementation of secure file transfer protocols to ensure data security. This system seamlessly integrates data input to dynamically populate letter content, streamlining the process while maintaining accuracy through errorchecking mechanisms. Additionally, we have established a user-friendly interface that simplifies the letter creation process, making it intuitive and accessible for all users. 

We successfully implemented ADS legislation changes (1 April 2024), modifying existing workflows and configurations to align with the legislation and incorporating additional data fields to capture required information. 

These efforts demonstrate our commitment to continuous improvement to make our services more effective and easier to use. Through implementing robust validation processes, automated systems, and enhanced search functionalities, we ensure our services remain user-friendly, reliable and reduce the need for corrective action.

However, to fully meet the evolving needs of taxpayers capital funding is critical. Access to this funding is a priority because it will significantly improve our digitalisation efforts, leading to an enhanced taxpayer experience. The ability to invest in modern technologies is vital to overcoming the challenges we face, such as managing increasing volumes of data from new taxes, and ensuring the accuracy and reliability of our services.

Compliance 

Revenue Scotland’s core function is the collection and management of the devolved taxes. This function includes a duty to protect the integrity of the tax system and ensure the correct amount of revenues are collected. We do this by encouraging a culture of responsible taxpaying where individuals and businesses pay their taxes as the Scottish Parliament intended. 

We work to make it as easy as possible for taxpayers to understand and comply with their obligations and pay the right amount of tax, while at the same time working to detect and deter non-compliance. Our approach to tax compliance has three key elements: 

• Enabling – we help taxpayers to understand and comply with their tax obligations through the services we provide. This includes the publication of clear, informative guidance; a user-friendly online system; our support desk; providing tax opinions; and engaging with and upskilling stakeholders, for example, by presenting technical webinars.
• Assurance – we use our resources and statutory powers to ensure the tax system is performing as expected and to help taxpayers to get to the right tax position. This includes checking returns to ensure they are complete, accurate and that the correct amount of tax has been paid; carrying out landfill inspections; sharing intelligence with other tax authorities; and the use of investigatory powers, statutory enquiries and assessments.
• Resolution – we seek to resolve disputes and pursue non-compliance by using our powers proportionately and applying penalties where required. In 2023 we published our Settlement and Litigation Principles which set out our approach to resolving tax disputes.

We continue to work closely with other UK tax authorities, sharing information, intelligence and knowledge with HMRC and the Welsh Revenue Authority (WRA). We do this through legislative gateways and through our formal Information Sharing Agreements. In addition we regularly discuss areas of potential legislative change in partnership with Scottish Government policy colleagues. 

We also regularly meet with bodies such as the Chartered Institute of Taxation (CIOT), the Institute of Chartered Accountants of Scotland (ICAS), the Association of Tax Technicians (ATT), the Law Society of Scotland (LSS), and the Convention of Scottish Local Authorities (COSLA), as well as other industry bodies.

Our data-led approach to identifying tax risks helps to ensure that our compliance resource maximises the level of assurance of the tax system whilst also targeting the most significant risks. The benefits of this approach are reflected in the strong 2023- 24 compliance activity results. 

As measured under KPI 3, our compliance activities secured £35.3 million in tax during the 2023-24 fiscal year. This figure comprises both additional tax secured as well as ‘tax protected’; for example, where we have prevented repayments being made where they are found not to be due, that has arisen as a direct result of our compliance activities. These results may reflect compliance activity that has taken place over a number of years which reached a conclusion during 2023-24. It does not comprise upstream assurance and compliance activity, such as improving our guidance or systems to assist taxpayers to comply with their obligations. 

These efforts align with several of our Excelling in Delivery objectives, including using our statutory powers appropriately to help taxpayers get to the right tax position, seeking to resolve disputes and pursue non-compliance proportionately, and adopting continuous improvement processes to make our services more effective and easier to use.

Disputes 

There are three main routes for taxpayers, agents and other members of the public who wish to dispute an action or decision by us, or on our behalf by our partner organisations. 

Complaints 

Complaints are expressions of dissatisfaction about our action or lack of action, or about the standard of service provided by us or on our behalf. They are distinct from tax disputes. Where complaints are received, we seek to learn from these to improve our operational procedures and processes. Through our complaints handling procedure we aim to resolve taxpayer dissatisfaction as close as possible to the point of service delivery. We conduct thorough and impartial investigations of complaints, so evidence-based decisions can be made on the facts of the case. Our complaints handling process complies with the Scottish Public Services Ombudsman’s (SPSO) guidance. This allows for two opportunities to resolve complaints internally: 

• Stage 1 – frontline resolution (response target timescale – 10 days or less)
• Stage 2 – investigation (response target timescale – 20 days or less).

Tax disputes – reviews and appeals 

We aim to minimise tax disputes by providing clear information and guidance to taxpayers and having robust decision making processes in place. In the event of a dispute, a taxpayer may request an internal review of a decision, request or agree to mediation, or appeal a decision to the Tax Chamber of the First-Tier Tribunal for Scotland (FTTS). 

Taxpayers and their agents have the right to request us to review any decision which affects whether a person is liable to pay tax, the amount of tax due, the date the tax is due and payable and the imposition of a penalty or interest. We must notify the taxpayers or their agents of our view of the matter within 30 days from the day on which we received the review request (or such longer period as reasonable). For the next stage we must inform the taxpayers or their agents of our conclusion of the review and its reasoning within 45 days of sending the Stage 1 response. 

RSTPA sets out the decisions which are reviewable and appealable. An appeal may be made regardless of whether or not a review has been sought or mediation entered into. The FTTS decides appeals against Revenue Scotland decisions, and the Upper Tribunal for Scotland (UTS) decides appeals on a point of law from decisions of the FTTS.

Appeals

We have collected data on litigation since Revenue Scotland was established in 2015. The data shows consistent trends of higher volumes of LBTT appeals compared to SLfT appeals and of the FTTS upholding our decisions in ADS appeals. During 2023-24, twenty-three appeals were initiated in the FTTS, all of which related to LBTT. We saw an increased trend of cases relating to disputes about whether residential or non-residential rates of tax apply. An increase in penalties for failure to make an LBTT return for three-yearly lease reviews gave rise to an increase in the number of appeals received. We expect to see a reduction in ADS appeals following legislative changes introduced from 1 April 2024.

As part of its collection and management functions, Revenue Scotland can make decisions which amend the amount of tax payable following a return, or impose penalties for failure to submit a return or failure to pay tax. Decisions like this are called appealable decisions and can lead to an internal review or ultimately an appeal to the FTTS. In the course of 2023-24, 283 cases went to review. In 213 of those cases, the original decision was upheld. In 63 cases, the initial decisions were cancelled, for instance due to new information received from taxpayers in the course of the review. Of the rest, 2 decisions were varied, 2 were not progressed as reviews and 3 reviews were withdrawn by the taxpayers. 

Over the year, 23 new appeals were raised in the FTTS. All of the 6 cases decided by the FTTS in the course of the year resulted in our original decision being upheld. This shows the vast majority of tax disputes end without the need for litigation, and we carefully consider our position before entering into or continuing with litigation (as demonstrated by the 8 cases which were settled before a hearing).

These figures can also be viewed in the context of 110,900 returns submitted in 2023-24, showing the very low number of reviews and appeals in relation to the overall volume of tax returns. This is testimony to the support and guidance that is available to taxpayers to help them understand and comply with their obligations. For those taxpayers who raise a dispute about a Revenue Scotland decision, we also proactively share examples of previous decisions that will assist taxpayers to understand the rationale for a decision where it is appropriate to do so. It also shows we are prepared to vary our decisions where that is justified and that we litigate responsibly.

Investing in our People

The second strategic outcome in our Corporate Plan 2021-24, “Investing in our People”, reflects the high value our organisation places on staff motivation and engagement. We invest in employee learning and development, as well as health, safety, and wellbeing. This commitment enables us to develop and support a highly skilled workforce that uphold the highest standards of professionalism and integrity. 

Strategic Outcome: we are high-performing, outward looking and diverse, and provide a great place to work as an employer of choice. Our staff are motivated and engaged, and we invest in their development and health, safety and wellbeing. The following KPIs measure our performance towards the Investing in our People Strategic Outcome.

• KPI 5: Skills and knowledge development
• KPI 6: People Survey Engagement Index/ Proxy Stress Index

The seven objectives are: 

• ensure our staff have the capability, skills and knowledge to deliver an excellent service
• ensure our staff have the skills and tools required to efficiently access and analyse our data to better inform decision making
• take action to expand the diversity of our workforce and promote access to employment for those with protected characteristics
• be a trusted, valued and respected tax authority which prioritises staff capability, skills and knowledge development
• be a high-performing organisation where staff feel trusted, valued, motivated and empowered – this helps us to create a culture with work/life balance, health, safety, wellbeing and resilience at the heart
• enhance our use of data to inform our capability and capacity requirements for the delivery of our organisational objectives 
• support individuals to have flexible choices on where and when they work.

Our People Strategy 2021-24 has direct links to the Corporate Plan and clear deliverable actions set out in the action plan. Progress against the action plan is reported to our Staffing and Equalities Committee throughout the year. Our People Strategy is underpinned by four themes. These are wide-ranging and ambitious, reflecting our commitment to being an inclusive and agile workforce: 

• engaged
• capable
• diverse
• workforce.

Leadership Development 

Building and maintaining leadership capability continues to be a priority - creating the conditions for staff to thrive. In Revenue Scotland we value our approach to collective leadership as this enables us to lead and manage change effectively. Our successful approach to leading and managing change is captured in the Civil Service People Survey, scoring highly with 76% in the Leadership and Managing change theme with the Civil Service score being 53%. 

The leadership development programme was tailored for the various leadership levels across the organisation, which range from first line managers to senior leadership. This year has also had a focus on succession planning and building the leadership capability of our managers. Developing confident leaders enables us to drive performance and innovation whilst identifying and nurturing our talent. 

These efforts align with our objective to ensure our staff have the capability, skills, and knowledge to deliver excellent service. By continuously investing in leadership development and succession planning we create a high-performing organisation where staff feel trusted, valued, motivated, and empowered. Moreover, enhancing our leadership capability supports our goal of being a trusted, valued, and respected tax authority.

Futures Project 

In May 2023, following a successful pilot, our Board approved hybrid working as our operating model. 

Our hybrid working model delivers excellent service to our users while also considering the health, safety and wellbeing of our staff, the performance of our statutory functions, delivering cost savings, future scalability, and alignment to our strategic aims (including diversity and green recovery). Our hybrid working model offers staff flexibility whilst ensuring business needs are met. 

We undertook a comprehensive options evaluation to consider its longer-term operating model. The evaluation established hybrid working as having the most benefits to the organisation, colleagues, and its service users. The pilot evidenced that hybrid working introduced a more modern and flexible way of working to deliver innovation, collaboration, productivity, equality, inclusion and care for our people and our environment. 

Evaluation of the pilot evidenced we performed well over the period of the pilot. Key Performance Indicators (KPIs) continued to be achieved. Results from the pulse and People Surveys indicated 72% of staff preferred the hybrid model. Colleagues also reported it had a positive impact on their health and wellbeing and they felt more productive.

With a formal move to a hybrid model there is scope to reduce overall emissions. We were also able to reduce our estate footprint during 2023-24 offering value for money. Reducing the office footprint enables staff to benefit from working together from one office space that has been redesigned and contains more collaboration space and a designated quiet working area. Revenue Scotland colleagues also continue to have access to a hub office in Glasgow. 

From 2024-25, we will continue to apply hybrid working principles to support our colleagues to embrace the benefits of home working while retaining the benefits people gain from being together in a workplace. 

This hybrid working model helps us give staff flexible choices about where and when they work. In offering this flexibility, we also ensure our staff have the skills and knowledge to deliver excellent service while feeling trusted, valued, motivated, and empowered. 

A further benefit of adopting hybrid working is that it helps us expand the diversity of our workforce and support employment for people with protected characteristics, contributing to our goal of being a diverse, high-performing public body.

Capability and Skills Audit 

Our Corporate Plan sets out our ambition to be a trusted, valued, and respected tax authority which values and prioritises capability, skills, and knowledge development. 

Our People Strategy sets our commitment to use our data to inform the capabilities we need to become a high-performing organisation as outlined in our Target Operating Model. 

In order to achieve this, we developed a Capability and Skills audit to help us to identify current capability strengths and areas for focus. This information will help drive our plans for increasing capability to deliver on our Corporate Plan for 2024-27. 

By understanding our strengths and weaknesses within our workforce, we can build in flexibility within the workforce to meet demand when required. This will also inform the skills we need to buy, borrow, or build within our current workforce.

The Capability and Skills audit was developed in consultation with leadership colleagues. The audit covers team skills and core skills required for the organisation. The audit has also captured professional qualifications across the nine recognised professions we have within our workforce. The audit was conducted in partnership with staff and their manager and has helped inform development plans for staff. It has also highlighted areas of expertise which will be used to build capability across the organisation increasing our knowledge capital. The audit results are available at organisation and team level and the findings have identified areas for focus in the coming year to increase our data and digital literacy and to continue to support our line managers to build confidence in leading and managing change. The audit will be conducted annually to enable us to track progress and ensure we are continuing to develop the skills we need to deliver the ambitions set out in our Corporate Plan 2024-27.

The Gatherings 

Bringing our staff together in person twice a year is integral to our hybrid way of working. It provides an opportunity for our staff to connect with our organisational objectives and purpose, contributing to our Business Plan and Corporate Plan delivery. 

Our summer gathering was an opportunity for staff and Board members to share feedback on our equality outcomes. Professor Kathleen Riach provided an in-depth session as a celebration of Adam Smith’s tercentenary whose taxation principles, 300 years on, form the basis of the Scottish Approach to Taxation. 

Our New Year gathering took on a new format and we were delighted to be joined by our Board member Right Honourable Ken Macintosh to share stories from his career and his experiences from the Scottish Parliament. Staff had the opportunity to hear from Tom Wilkinson on Scotland’s Artificial Intelligence strategy and what it means for Revenue Scotland. These events are designed by our staff for our staff and provided a great opportunity to network and connect with colleagues old and new.

Health and Wellbeing 

At Revenue Scotland, we are committed to supporting staff health and wellbeing. In July 2023 we introduced the Wellbeing Hour pilot, allowing employees to focus on their health and wellness. A six-month evaluation of this initiative shows positive impacts on staff mental wellbeing. Most employees used the Wellbeing Hour for exercise, highlighting its success in encouraging physical activity. Overall, the pilot has been well-received, with staff appreciating the chance to prioritise their mental health. 

Learning and Development 

Learning and development is a major focus in our People Strategy. We have a KPI for 90% of staff to complete 30 hours or more learning and development each year – and in 2023-24 98% of staff achieved this target. We know having a skilled team is crucial for our success. Our Scottish Tax Education Programme (STEP) which launched in 2019 is the foundation for building capability across the organisation for all staff. This is designed and delivered by our staff, for our staff and builds on our learning from Tribunal cases and legislative knowledge. The STEP programme supports the transfer of knowledge and skills throughout the organisation to ensure the programme’s sustainable delivery. It is a pivotal part of our induction to Revenue Scotland, building understanding of our role as a devolved Tax Authority. We’ve consistently delivered the STEP programme across this last year, providing new team members with a solid foundation through our Induction Programme.

Our main goal has been to enhance our skills and the way we work together. The Professional Qualifications Policy has been a helpful addition, it has allowed our staff to build their professional capability in Health and Safety, Governance, IT, HR and Finance. The learning and development offer for 2023-24 was developed based on learning needs analysis and supported staff to develop their skills against a range of topics. Our induction programme has been updated to reflect our hybrid principles and includes an in person induction and in person on job learning to improve the induction experience and connection with our teams and organisation. 

In addition, learning has also seen a shift towards in person providing the optimum learning experience for our staff, we do continue to offer a blend of in person and virtual learning depending on the subject matter. 

Our learning and development activities ensure our staff have the capability, skills, and knowledge to deliver excellent service. By focusing on professional development and tailored training programs, we help our staff become more effective and informed in their roles, contributing to our strategic outcome. 

Moreover, our commitment to learning and development supports our goal of being a high-performing public body where staff feel trusted, valued, motivated, and empowered. This approach not only improves individual performance but also supports a culture of continuous improvement and resilience within Revenue Scotland.

Civil Service People Survey 

Our People Survey results have continued to progress over the years, seeing Revenue Scotland rise to be in the top 25% of all participating organisations, and in the top six for all survey themes. This performance reflects our organisation’s culture, staff engagement our investment in our people. The 2023 People Survey results saw the engagement continue to increase to 70% from 54% in 2019. The index is comprised of five questions measuring pride, advocacy, attachment, inspiration, and motivation. The Proxy Stress Index remained stable at 21%, this measures factors that cause stress rather than those that alleviate it with a lower percentage score indicating lower stress. The index is based on the Health and Safety Executive stress management standards; demands, control over work, support, relationships, role in organisation and change.

Leading and managing change effectively is a priority for our leaders. Our People Survey results at 76% are 28 percentage-points higher than the Civil Service average score, placing our organisation as third highest in this theme across the 103 Civil Service organisations that took part in the survey. 

We continue to build on our survey results which speak to our ambition in the Corporate Plan to be an exemplary employer and be the employer of choice.

Reaching Out

Strategic Outcome: to build on our reputation as an accessible, collaborative and transparent public body. We are keen to learn from others and share our experience and expertise. The following KPIs measure our performance towards the Reaching Out Strategic Outcome. 

• KPI 7: Service users’ feedback
• KPI 8: Equalities 

To achieve this outcome, we have seven objectives: 

• engage users in the design of our services, maximising the opportunities of technology and drawing on best practice from other service delivery organisations
• help taxpayers to understand and comply with their tax obligations through the services we provide
• engage regularly and effectively with users to keep them informed, content and productive, enabling them to work collaboratively
• effectively communicate data and analysis to our stakeholders and audiences. This includes the provision of high-quality data and advice to support the Scottish Fiscal Commission in its tax forecasting role and the Scottish Government in the development of tax policy
• in our communications, provide the audience with the right information in the right tone and style at the right time
• expand the reach of our engagement to diversify our stakeholder base and sharpen our understanding of equality issues, digital developments, and our operating environment
• as a transparent and open organisation, listen to and engage collaboratively with our staff and our stakeholders.

Stakeholder engagement 

Stakeholder engagement has remained a key focus during 2023-24. Throughout this period, we have undertaken a range of activities to ensure effective communication and collaboration. 

One of our key functions is to provide information and assistance to taxpayers and our partners relating to the devolved taxes. This year, we have organised a number of virtual events covering high-interest topics for taxpayers and tax professionals, covering ADS and leases. These webinars, which included reference to updated guidance on legislative changes, attracted over 300 attendees and received a high satisfaction score. To ensure broader accessibility, we have made these webinars available on our YouTube channel. 

In addition to this, we have been engaging on another of our legislative functions: to provide information, advice and assistance to Scottish Ministers in relation to tax. In this area, we have provided support to the Visitor Levy Bill Team and the Visitor Levy Expert Group on matters relating to self-assessed tax. We have organised a workshop for local authorities to understand more about Revenue Scotland and how we operationalise our taxes in a self-assessed environment.

Regular meetings with Scottish Ministers and their officials have allowed us to provide advice to support the development of policy and legislation in relation to devolved taxation. This engagement focuses on strengthening our existing legislation and supporting the development of new legislation. By providing our expertise and practical experience of managing and administering the devolved taxes, we are able to ensure advice captures the views of taxpayers, tax professionals and Revenue Scotland staff, where appropriate. 

In July, we were visited by the then Deputy First Minister Shona Robison MSP. The Deputy First Minister joined our weekly SLfT meeting with SEPA to see first-hand how our collaborative approach with SEPA works in practice. She was introduced to our Scottish Aggregates Tax team to learn about our approach to introducing Scotland’s third devolved tax. Additionally, she met with members of our Tax Operations team to learn about our new enhanced support policy for supporting taxpayers and agents. 

We have also supplied data and information about the performance of the devolved taxes to the SFC, aiding their independent forecast of Scottish tax revenue. Our commitment to transparency is reflected in the production of official statistics on both devolved taxes, which are published on the Revenue Scotland website. 

We attended Parliament on three separate occasions in 2023-24 to provide evidence to the Finance and Public Administration Committee. In May, our CEO Elaine Lorimer gave evidence on Public Service Reform, sharing Revenue Scotland’s approach to digital services, our shared-services model, and our approach to empowering taxpayers. Following the publication of our Annual Report and Accounts for 2022-23, we were invited by the Committee to provide evidence on our annual performance. Our Chair Aidan O’Carroll and our CEO Elaine Lorimer attended the evidence session, and enjoyed the productive engagement with MSPs. Additionally, we gave evidence on the new Scottish Aggregates Tax Bill to the same Committee.

In November we hosted a reception at the Scottish Parliament to discuss our latest Annual Report and Accounts for 2022- 23. This event featured a keynote speech by Tom Arthur MSP and was attended by representatives from Revenue Scotland, key stakeholders, and MSPs. 

Furthermore, we have engaged with other tax authorities on tax administration issues and collaborated with other public bodies on various corporate matters, including risk management, business planning, and equalities and diversity. 

These efforts align with our objective to effectively communicate data and analysis to our stakeholders and audiences. By providing high-quality data and advice, we support the Scottish Fiscal Commission in its tax forecasting role and the Scottish Government in developing tax policy. 

Our activities reflect our commitment to being a transparent and open public body. We listened to and engaged collaboratively with our staff and stakeholders, ensuring we provided the right information in the right tone and style at the right time. 

Service user feedback 

We are dedicated to placing users of our website, support desk or SETS at the heart of our service. This year, we measured user satisfaction primarily through feedback collected on our main digital platforms: our website revenue.scot and the Scottish Electronic Tax System (SETS). These insights have been invaluable in helping us understand how effectively our digital services are meeting user needs. 

The revenue.scot website attracted over 190,000 visitors, we welcomed 1,400 new users on SETS, and 110,900 tax returns were successfully submitted in 2023-24. To better understand user needs, we implemented feedback forms across both revenue.scot and SETS.

Receiving feedback is crucial for us to understand what is working well and what needs improvement. This year, we received nearly 1,000 pieces of feedback. For example, agents informed us of challenges in locating information on the SETS homepage, particularly regarding penalties and outstanding balances. They also highlighted difficulties in navigating between different pages and filtering/sorting information. 

In response to this feedback, we have made various enhancements to the SETS system over the past year. We improved the homepage, navigation, and search functionalities, and added more features to enable users to search, sort, and filter information effectively. However, there are still areas where we can improve. We aim to enhance how we share information about penalties with agents who act on behalf of taxpayers, and we plan to implement a resolution for this in the upcoming financial year. 

We also received feedback regarding the guidance on our website. In response, we updated our materials, providing clear explanations in plain English and offering guidance in various formats. This year, our focus has been on improving ADS and Leases guidance. We reviewed and expanded examples in the ADS guidance and provided step-by-step videos to help taxpayers better understand and comply with their tax obligations. Next year, we’ll be updating the website to use the Scottish Government Design System, which will enhance accessibility, and we’ll continue refining the guidance based on ongoing feedback.

This is our first year reporting on service user satisfaction, and we consistently met our KPI 7 target, achieving a 76% satisfaction score. Looking ahead to next year, we plan to broaden our approach by collecting feedback across the full range of services we provide, not just from our website and SETS. This expanded approach will allow us to gain a more comprehensive understanding of user experiences and identify opportunities for improvement across all areas of our service delivery.

Equalities 

At Revenue Scotland, we are committed to embedding equality, diversity and inclusion (EDI) at the core of our organisation, both for our staff and the communities we serve. In May 2022, an Internal Audit review of our Equalities performance confirmed the progress of our EDI initiatives and provided valuable insights. 

We embraced its findings, using them as a springboard to become more peoplefocused and outcome-driven, shifting our emphasis from process to meaningful engagement. This year, we completed all the actions flowing from that review and they are described here - Revenue Scotland - Equalities Mainstreaming report 2024-2028 | Revenue Scotland. 

Our objective was to highlight our achievements clearly by showing specific examples. We champion EDI - for instance we have enhanced the accessibility of our website and our learning offer to our staff – see below.

The outcomes we advanced this year, as detailed in the Equalities Mainstreaming Progress Report 2020-22, were: 

• Equality Outcome 1: Revenue Scotland will design and deliver public services that meet the diverse needs of its users 
• Equality Outcome 2: Revenue Scotland is building an increasingly diverse workforce that fully embraces equality, diversity, and respect for all 

The Revenue Scotland Equalities Mainstreaming Report 2024-2028 also shows the work that has taken place up to 31 March 2024 to embed the Public Sector Equality Duty (PSED) into our operations and demonstrates our readiness to be held accountable for the next reporting cycle. Our new outcomes for 2024-28 are aimed at driving progress and meaningful change to deliver better outcomes for our staff and service users. 

Our Equalities Steering Group (ESG) and Equalities Working Group (EWG) are made up of staff from across our teams and the Steering Group benefits from a member external, thereby bringing cross fertilisation of thinking. Along with EDI Champions (an advocacy type role which staff volunteer for), these groups have been pivotal in setting the strategic direction for our work in this area and ensuring EDI remains at the forefront of our decision-making. 

Our leadership team, including the Board and CEO, has strongly supported our EDI work, ensuring these values are integral to our culture.

Celebrating our 2023-24 Achievements: 

• We successfully met our KPI for the year, demonstrating our commitment to delivering on the challenging outcomes and actions we set for ourselves
• We conducted a thorough period of internal and external consultation to gather views on our new outcomes for the 2024-28 period. This ensured the perspectives of our staff and service users are reflected in our new outcomes
• We enhanced the technical aspects of our services, including significant upgrades to accessibility and assistive technologies on our website. We introduced the Recite Me tool, a suite of accessibility tools designed to make our website more inclusive. This allows users to customise their browsing experience with features like text-to-speech, translation, and adjustable display settings to better meet their individual needs 

Our success is also reflected in a number of key projects that have significantly contributed to our goal of becoming an increasingly equal, diverse, and inclusive public body:

• Following an internal review, we relaunched our revised suite of Equality Impact Assessment tools and materials for our staff, leading to enhanced EDI outcomes for both our staff and service users
• We continued to offer our Enhanced Support services to the public, with notable positive impacts
• Through our Health & Wellbeing group, we have elevated our EDI staff engagement and profile by running awareness campaigns and participating in events such as Pride for the first time

Our efforts to develop a more inclusive culture are reflected in the People Survey results related to employee experience, equality, and diversity, reflecting the positive impact of our EDI initiatives. Our commitment to EDI is further demonstrated by our inclusive recruitment approach by using inclusive language in job adverts, improving our careers information to celebrate our culture and removing barriers within the recruitment process by sharing interview questions in advance to all candidates. Revenue Scotland colleagues are also encouraged to record their diversity information. This information is used to monitor how we are performing as a truly representative organisation. Revenue Scotland ranked second highest across Civil Service for inclusion and fair treatment in the 2023 People Survey. 

While we acknowledge that there is still work to be done, we stand ready and fully engaged to continue our EDI journey. Together, we will keep pushing boundaries and setting new standards for equality, diversity, and inclusion within Scotland’s public sector.

Volunteering 

Volunteering provides many benefits to both mental and physical health. Employees of Revenue Scotland are allowed up to six days of volunteering per year and they can use them in different ways, including group volunteer days. 

In December 2023, a group of five colleagues from Revenue Scotland visited Empty Kitchen, Full Hearts (EKFH) a charity based in Edinburgh. Their main mission is to relieve poverty by providing free, healthy, nutritious meals made from surplus food donated by a wide variety of suppliers. Part of this initiative involves the delivery of meal packs to homes or local community hubs as well as offering onsite meals on Fridays. 

The day began by chopping vegetables in the morning that would go into a hearty vegetable soup and also to be part of a Christmas dinner that the people in need would be receiving as we were only days away from Christmas. The afternoon consisted of decanting some of the earlier prepared food to produce the meal packs, consisting of two days’ nutritious food per person. 

The team was really struck by the great work and fantastic spirit by all of the team at EKFH, and how welcoming and friendly they were. In addition to that the opportunity for them all to do something so positive together and be supported by Revenue Scotland in doing so was a great experience. This was an excellent opportunity to get to know each other better and contribute to our wider community in a meaningful way. Everyone involved remarked how much they’d enjoyed the day and wanted to do this again.

This volunteering initiative supports our objective to expand the reach of our engagement to diversify our stakeholder base and sharpen our understanding of equality issues, and our operating environment. By engaging in community service, we build stronger relationships and enhance our understanding of the communities we serve.

Looking Ahead

The fourth strategic outcome in our Corporate Plan 2021-24 is Looking Ahead. Strategic Outcome: to plan and deliver change and improvements to our systems and processes flexibly, on time and on budget. The following KPI measures our performance towards the Looking Ahead Strategic Outcome. 

• KPI 9: Delivery of key strategic projects

This KPI measures our performance against our strategic projects, summarised on pages 19-21. The projects have been discussed in detail throughout Performance Analysis section, and all projects are either on track or have been completed. 

To achieve our Looking Ahead ambitions, we have seven objectives.

• working with stakeholders, partner organisations and Scottish Government colleagues to use our expertise to design and deliver any new devolved taxes and other revenue raising measures
• work with others to identify opportunities for sharing IT platforms and management tools to support operational processes 
• exploit the potential of Revenue Scotland’s data by linking to other data sources to deliver better policy outcomes
• include environmental impact as a consideration in the design and delivery of any new or changing responsibilities
• encourage staff to be active, engaged, responsible learners who own their learning and development
• actively plan ahead for our future workforce and capability needs
• ensure our communications are scalable and capable of being adapted to new responsibilities and audiences.

Environmental sustainability 

As a public body environmental sustainability is a core feature of our Corporate Plan. We contribute nationally to meeting environmental objectives through the collection and management of Scottish Landfill Tax. In working closely with SEPA and other partners, we are committed to ensure there is compliance with the tax regime, which is designed to reduce the level of waste going to landfill and maximise recycling. 

We further support Scotland’s climate change goals by collecting SLfT which promotes alternative waste solutions and reduces hazardous waste impacting climate change. Overall, landfill waste has decreased since 2015. There was a minor increase in 2021-22, likely due to pandemic-related delays. There were particularly large decreases in 2023-24, with record lows of waste going to landfill in each quarter. Collaborative efforts with SEPA have generated over £68.4m in SLfT revenue in 2023-24.

The Scottish Landfill Communities Fund (SLCF), established in 2015, provides funding for community and environmental projects to mitigate landfill-related issues. We appointed SEPA as the regulator for the SLCF. To date, £62.0m has been contributed to the fund, with £4.4m in qualifying contributions this year. Contributions have been declining, likely due to a reduction in landfilling as the ban on biodegradable municipal waste approaches in January 2025. 

We are continuing our preparations for the biodegradable municipal waste ban in 2025. We’re proactively engaging with the Scottish landfill industry, supporting Scotland’s climate and circular economy goals, albeit with expected decreases in SLfT revenue. This situation introduces tax risks like waste misclassification and unauthorised disposal. To counter these, we’ve incorporated risk mitigation strategies into our compliance plans and continue to collaborate with SEPA to tackle potential challenges proactively. 

Our taxes are digital by design, with taxpayers submitting digital tax returns for all our taxes. This has several primary and secondary benefits, from reducing our own paper, ink and cartridge waste, facilitating the reduction in waste from taxpayers and agents, as well as reducing postal delivery emissions. 

In preparation for implementing the Scottish Aggregates Tax, we’ve continued strategic discussions with the aggregates industry. Our aim is to collaborate closely with the industry to develop an environmentally sustainable tax with a digital tax return process.

In September 2023 staff completed our annual sustainability survey. The aim was to understand attitudes and behaviours related to commuting and remote work. The insights gathered were used to deliver staff training on sustainability. The survey data found 53% of our employees commute to work using a petrol or diesel car, 15 percentage-points below the UK average of 68%. Similarly, 22% of our staff commute to work by foot, 11 percentage-points above the UK average. Whilst working from home, almost 3 out of 4 staff use energy efficient LED bulbs, demonstrating our environmental awareness.

Scottish Aggregates Tax

Our programme of work has laid solid foundations for the operationalisation of Scottish Aggregates Tax (SAT) with our programme team having been in place since 2022-23, with underpinning projects defined and initiated. Our Programme Board includes representation from key areas, both internal and external to Scottish Government, and provides our Head of Tax with support and assurance in his role as Senior Responsible Officer. We have clear governance and escalation routes established to support effective decision making to ensure readiness across the business ahead of implementation of the tax in 2026. We have also worked closely with colleagues in Scottish Government to inform and support the development of legislation and the design of the tax.

We continue to engage closely with industry representatives working collaboratively with our Scottish Government colleagues in planning, establishing, and facilitating the Stakeholder Expert Advisory Group. This has afforded us an insight into the workings of the industry, the challenges it faces and how we may administer and deliver SAT in a way that supports good practice and the establishment of the level playing field which is a critical requirement for the aggregates community. 

Work is underway in gathering requirements for the development of our IT collection system and we are about to commence discussions with industry representatives on more detailed requirements such as the design of the tax collection form. We have plans in place to continue this engagement through to delivery and beyond. 

Our programme will ensure our staff and taxpayers are prepared for the introduction of the tax with all necessary internal changes planned and delivered. Guidance and communications will also be prepared and available ahead of the launch. We are engaging closely with representatives across the industry and will continue to do so throughout the programme. In support of a digital-first approach, we have commenced further development of our SETS digital platform to enable online collection of Scottish Aggregates Tax by default.

Legislative framework 

The legislative framework project began as a review of the RSTPA and commenced in June 2022. The original aim of the project was to explore Revenue Scotland’s current remit under the legislation and identify any changes required to enable delivery of our ambitions in the Corporate Plan. After initial scoping, the project grew and continued to develop in 2023-24. 

The themes of the project are (i) the role of Revenue Scotland; (ii) digital; (iii) data; (iv) tax processes and (v) tax technical. In 2023-24, we split the project into phases. The first phase was largely limited to items which have an impact on SAT. Future work may encompass other tax-technical matters more specific to LBTT and SLfT. A major milestone in 2023-24 was the inclusion of some of the first-phase proposals in the Aggregates Tax and Devolved Taxes Administration (Scotland) Bill, which was introduced to the Scottish Parliament on 15 November 2023. 

There are five key measures in Part 2 of the Bill which will: 

• adjustments to support the functions of designated officers 
• enable subordinate legislation to be made on communications from Revenue Scotland to taxpayers (including the use of electronic communications) 
• enable subordinate legislation about the use of automation 
• clarification on certain LBTT penalties, and 
• introduce set-off provisions

We have been working closely with the Scottish Government on the provisions, preparing the Bill for introduction and latterly offering support in relation to Stages 1 and 2 of the Bill. We were invited to give evidence on the Bill at Stage 1 of its consideration by the Finance and Public Administration Committee on 12 March 2023.

Scottish Government Business Transformation 

The Scottish Government is introducing an integrated cloud-based platform that brings together HR and Finance data for the first time. Joined-up data and insight will drive strategic and organisational design and inform workforce plans. The platform will empower users to create, manage and change their own information on a self-service basis. 

Revenue Scotland will receive this new service as part of the shared service offering provided to us. The Scottish Government transformation programme team have conducted regular engagement sessions with shared service customers, our HR and Finance colleagues attend regularly. As this is a position-based platform, all staff have been assigned to a profession and the relevant job architecture. The data validation carried out will enable staff to be assigned to the correct position and will provide data across all the 21 professions within Scottish Government. Revenue Scotland currently has staff distributed across nine professions.

Business readiness is kept under close review and areas of concern are highlighted by us to the transformation programme director. Key risks related to the programme and their impact on Revenue Scotland have been discussed regularly at the Audit and Risk Committee. The platform launch date was moved from April to October 2024 to provide ample time for thorough user acceptance testing and to ensure the necessary levels of assurance can be achieved. The programme director hosts monthly customer board meetings and reviews the programme status – as a customer we receive these updates. A communications strategy is in place by the programme which is being supplemented by Revenue Scotland to support the organisation’s readiness. Training will be delivered to staff and managers prior to go-live which is scheduled for October 2024.

Corporate Plan Development 

The RSTPA requires us to prepare a corporate plan every three years. 

In the next Corporate Plan period, between 2024 and 2027, we will be introducing a third devolved, Scottish Aggregates Tax, and there is the potential for a fourth in the Scottish Buildings Safety Levy. 

Our aim is to continue to build on our foundation of achievement, and the new plan will focus on four strategic outcomes: (1) Operational Excellence; (2) Investing in Our People; (3) Working with Others, and (4) Expanding Horizons.

The development of our new Corporate Plan was a collaborative effort amongst staff, with engagement sessions throughout 2023-24. We hosted separate focus groups for Scottish Government colleagues as well as for our external stakeholders. The feedback from these sessions was invaluable and showcases our ambition to work closer with others. 

Our Board approved the new plan in February 2024, and we were delighted to submit our Corporate Plan, Revenue Scotland’s third plan since 2015, to Ministers in March. The new Corporate Plan was approved by Ministers and laid in Parliament on 28 March 2024. Our new Corporate Plan for 2024-27 can be accessed here: Corporate Plan 2024-27

Corporate Governance matters 

Risk management 

We operate under an established Risk Management Framework which aligns with the best practice guidance presented through the Scottish Public Finance Manual (SPFM) and the Scottish Government’s Risk Management Guidance document. 

The framework sets out the process for identifying and documenting risk, assigning ownership of risk, scoring risk, determining responses to risk and monitoring and reporting on progress in managing risk. A review of the framework was undertaken and completed during 2023-24 to ensure that it continues to meet our needs. 

To achieve our ambitions, strategic outcomes and objectives, as set out in our Corporate Plan, it is essential we understand, manage and communicate the range of threats and opportunities that could hinder or enhance the organisation.

We ensure risk is sufficiently scored and managed prior to taking action to mitigate it or to take opportunities resulting from it. Explicit reference to ‘risk appetite’ – the agreed amount of risk the organisation is willing to accept in pursuit of its objectives – allows us to adopt a common understanding across our organisation. It also provides a framework for risk owners and managers to confidently make risk-based decisions. 

During the year the ARC undertook a review, with staff and Board members, of the corporate risk register. This had a particular focus on identifying risk appetite. Looking forwards, in light of our new Corporate Plan for 2024-27, a full review of our corporate risks will be conducted.

Defining a corporate risk 

Corporate risks are those that are significant, cross-cutting, and of strategic importance, posing a potential threat to an organisation’s operations, financial performance, reputation, or strategic outcomes. These risks may arise from a variety of sources, such as changes to our operating environment, regulatory changes or other unexpected events such as cyber- attacks, natural disasters or pandemics. 

Corporate risks can have a significant impact on our ability to achieve our goals and objectives, and as such, require the attention of senior management and the Board. While all members of staff have responsibility for managing risks in their areas, each of the corporate risks has one or more named risk owner(s) and a risk manager who, together, are accountable for their management. Our Board retains ultimate responsibility.

The corporate risks as they stood at 31 March 2024 are set out below. These risks have been actively managed throughout the year by risk managers and risk owners with oversight from the Senior Leadership Team, the ARC and the Board.

Key issues and risks 

Revenue Scotland has managed a range of risks and issues over the last year. Our Board continues to be informed throughout the process, closely scrutinising and monitoring the management of these. A detailed review of the corporate risk register, with a focus on risk appetite, was undertaken jointly between staff, members of the Board, and the Audit and Risk Committee in August 2023.

To improve our risk management framework, we continuously review our assurance map as part of our commitment to continuous improvement. During the year this review process identified a number of areas with scope to strengthen controls and enhance risk mitigation. We thoroughly evaluated existing controls across various business functions and strategically enhanced our approach in key areas to ensure comprehensive risk coverage. The following section discusses the key risks and issues, along with the initiatives undertaken to manage these in 2023-24.

Protecting the integrity of the tax system

The devolved taxes are self-assessed, meaning taxpayers calculate for themselves how much tax is due. If we disagree with the amount assessed, or a return has not been submitted, we may make decisions calculating the tax. Taxpayers can challenge our decision, requesting a review (where the decision is reconsidered by another member of staff) or appeal it to the FTTS.

Litigation carries cost and risk for taxpayers and the public purse; therefore, we strive to minimise the scope for tax disputes to arise. We do so by proactively providing services supporting the taxpayer to pay the right amount of tax at the right time. These include high quality guidance, webinars, the opinion service, support desk, direct contact with caseworkers and upholding our Charter of Standards and Values. If a dispute emerges, we strive to find areas of agreement. In instances where agreement cannot be reached litigation may ensue in the FTTS. In that forum we co-operate with the FTTS in fulfilling its overriding objective to deal with cases fairly and justly. We also apply our Settlement and Litigation Principles to guide how we undertake disputes. 

In the interest of resolving disputes quickly and efficiently, we are open to settle a dispute by agreement at any point, including during litigation. In 2023-24, we worked collaboratively with taxpayers to reach settlements and the best practicable outcomes whilst still protecting revenue. This approach resulted in eight appeals being withdrawn by the taxpayer. 

Disputes can highlight common issues with the legislation. We support our Scottish Government colleagues where the requirement for legislative change has been identified. 

Disputes can also indicate where improvements could be made to the tax system. In recognition of this, we routinely reflect on and implement continuous improvement during and on conclusion of disputes.

Legislative and policy change 

It is vital we understand the legal framework in which we operate to ensure compliance with requirements and duties. Our staff maintain an overview of legislative developments and requirements relevant to Revenue Scotland. For instance, Corporate Services teams keep up to date with developments in data protection, procurement and equalities legislation. Tax and Legal colleagues stay informed about developments in comparable tax jurisdictions that might inform our approach. In performing our core functions, we may also identify ways in which legislation could be improved to reduce risks like loss of tax or create a more efficient tax system. We have channels for raising these issues with Scottish Government colleagues. We advocated for change to our governing legislation which has been included in Part 2 of the Aggregates Tax and Devolved Taxes Administration (Scotland) Bill. 

Communications and stakeholder engagement 

A key risk we continually address is the need to effectively promote our organisation and its services to stakeholders. It is essential that stakeholders are well-informed about the services we provide. Our communications strategy and engagement plan are designed to enhance our visibility and assert our presence. This ensures that the value we provide is clearly understood and appreciated by both current and potential stakeholders.

To further our outreach and engagement objectives we have actively participated in a number of high-profile external events during the year. One such event was hosted at the Scottish Parliament. This provided us with a prestigious platform to showcase our capabilities. These events play a crucial role in enhancing our profile and allowing us to directly engage with key stakeholders. Our engagement has extended into significant areas of public interest, including attending the Finance and Public Administration Committee several times during the year. This exposure is helpful in demonstrating our commitment to transparency and accountability and to influencing and contributing to discussions that are central to our sector. Work in this area has also formed a key strand of our new Corporate Plan 2024-27.

Ways of working 

Adopting an evidence based approach to hybrid working has enabled us to develop a robust approach, where staff are empowered to work flexibly and encouraged to connect with purpose. Through our diversity, health, safety and wellbeing calendar of events we have engaged staff on a broad range of topics. These include celebrating Pride, raising awareness on breast cancer, sleep hygiene and supported staff to participate in volunteering activities to support our local community. Our approach to communication and engagement is transparent and collaborative. Our staff support the design and delivery of our weekly All Staff meeting and our in person conferences which are integral to maintaining connection as one organisation who are all aligned to our purpose and objectives.

Staff capacity and capability 

Investing in our people has continued to evolve, our approach to learning and development has seen 98% of staff complete at least 30 hours learning throughout the year. Building our professional capability is a priority, staff have been supported to undertake professional qualifications and we continue to build our leadership and line management capability. Driven by the need for quality data we have undertaken a capability and skills audit, this allows us to measure our areas of strength and develop solutions for areas requiring attention. This audit will be conducted annually alongside our performance and talent assessment, all of which result in an enriched discussion and quality development plans that supports our staff to thrive at work. Our approach to workforce planning regularly reviews our priorities against our Target Operating Model and succession plan to ensure we create pipelines for emerging talent. Our approach saw our People Survey results rise from 50% in 2016 to 71% in 2023. This gave Revenue Scotland the second highest score across Civil Service in the learning and development theme, a significant achievement we are proud of. 

Health, safety, and wellbeing 

The Civil Service People Survey measures staff response to resources and workload. Over the theme we scored an overall 86%, which is the 4th highest in the Civil Service and a 5-percentage point improvement on last year. In addition, 92% of respondents confirmed they have a good balance between work life and home life. Throughout last year we have maintained a strong focus on mitigating risks associated with health, safety, and wellbeing. Our commitment to these areas is demonstrated through our regular contact with experts who provide competent advice for both our landfill operations and the other areas of our organisation. We will be implementing proactive measures to anticipate and adapt to new issues that may impact our health, safety, and wellbeing practices – such as visiting quarry sites as part of Scottish Aggregate Tax. These steps ensure that we not only comply with current regulations but we are well-prepared for any future requirements.

Digital systems performance and adaptability 

With our digital-first principle at the forefront of our decision-making, in 2023- 24 we have successfully implemented a number of digital initiatives to enhance the efficiency of our operations, whilst reducing risk. We’ve made many user-centric improvements, designed to streamline processes, and ensure user-friendliness and accessibility for both agents and taxpayers. 

In April 2023, we launched our new Enhanced Support Service. The service aims to provide tailored support at the earliest opportunity to service users who need extra help. Development of the policy included engaging with a range of internal and external stakeholders to enhance the service offering. Feedback was also gained to inform the suite of training delivered to Revenue Scotland colleagues to support staff members to identify and communicate effectively with users about the service. 

The service can offer support to a broad range of users, including those with communication difficulties and health conditions. Support is tailored to individual needs and can include providing communications in other languages and formats including: braille and large print; access to a video relay service for Deaf/ British Sign Language users; and, support to register a Power of Attorney or extra time to complete forms. During 2023-24 the service helped a range of taxpayers including those impacted by bereavement and financial difficulty. 

We introduced a new protocol allowing agents to access data from previous returns through a three-year review, assignation, or termination by way of an additional declaration. This change has improved the accuracy and efficiency of data management and return submissions. Additionally, we have provided a set of standard paragraphs to aid responses to queries via email or our secure messaging system. 

Further improvements were made throughout 2023-24 to support taxpayers submitting lease returns. Taxpayers can now view their newly submitted returns and a simplified process was also introduced for agents. We have also increased security and validation measures for submitting returns, reducing the risk of unauthorised access and data errors. 

To support taxpayers and provide a more efficient service we also introduced an enduring agent authorisation. Agents retain authorisation unless we are notified by the taxpayer or agent to change the authorisation. This ensures continuity and reduces administrative burden for both taxpayers and agents. 

Enhancements have also been made to the usability of the agent dashboard on SETS during 2023-24 to enable easier visibility of returns submitted by an agent separate to returns submitted by their organisation.

Finally, the introduction of QR codes on our letters has made it easier for recipients to access information and complete necessary actions quickly and efficiently. Our trial with property address reminder letters earlier this year led to a percentage point increase of 8.32% for on-time returns.

Information and cybersecurity 

Cybersecurity continues to be a critical area of focus as the threat landscape continues to evolve. This year we enhanced our cybersecurity measures by conducting a comprehensive business continuity exercise specifically targeting the risk of unauthorised access to our social media accounts. This exercise, along with benchmarking activities conducted during the year, has helped us to identify potential vulnerabilities and areas for improvement. We also continued to work closely with our range of suppliers, to ensure that their cybersecurity arrangements continue to be appropriate. Our ongoing efforts in this area are crucial in protecting the data we hold and maintaining the trust of our stakeholders.

The Scottish Government’s HR and Finance Corporate Transformation 

We are working closely with the Scottish Government on the corporate transformation programme, which aims to enhance efficiency in managing staff data and improving the finance system. This initiative promises numerous benefits, including streamlined processes, improved data accuracy and visibility, and greater overall efficiency. Our priority will be to ensure these new systems align with our operational goals and are successfully integrated into existing processes to maximise their positive impact.

Values and behaviours 

Our staff are civil servants who adhere to the Civil Service Code. Staff are expected to carry out their duties with a commitment to the civil service core values of integrity, honesty, objectivity and impartiality. Staff must not misuse their official position to further their private interest or those of others; accept gifts, hospitality or other benefits from anyone which might reasonably be seen to compromise their personal judgement or integrity. All staff undertake annual mandatory training on counter fraud, bribery and corruption to remind them of their responsibilities in this area.

Records management and GDPR 

We are constantly seeking to improve our performance in records management and information governance, to ensure that the public’s data is protected and that we remain efficient as an organisation. This work also has synergy with our wider ambitions relating to data and digital and also our corporate responsibilities to respond to evolving cyber threats and technological developments. 

During 2023-24 again participated in the National Records of Scotland’s Progress Update Review (PUR). This is a voluntary scheme which assesses the records management plans of public sector organisations in Scotland. Additionally, as part of our ongoing improvements, an Information Management Plan has been developed which covers numerous areas such as policy updates and governance issues. This has resulted in a strengthened network of Information Management Support Officers (IMSOs) who champion information governance work within our organisation. We have also ensured that our Privacy Notice keeps pace with the organisation’s activities and is more accessible on our website. The work on the Information Management Plan has also led to a review and update of our data breach reporting, as well as a greater awareness of information security issues amongst Revenue Scotland staff.

During this reporting period, we introduced a new mandatory training course for our staff to complete which covers key topics relating to Information Management and Information Security. This course will continue to be run regularly during the training year and updated as required. Additionally, we also ensure that our Board members and advisers on the Tax Assurance Group (TAG) complete security and data protection training, as well as training related to cyber resilience. 

This year, we have also established an Information Governance Group (IGG) which brings together key stakeholders within Revenue Scotland whose role is to provide advice and support to the Senior Information Risk Owner. Its remit is to ensure Revenue Scotland’s approach to information governance and organisational practices is effective, including progressing Data Protection Impact Assessments, reviewing new legislative developments, dealing with compliance matters, and embedding a positive information management culture within the organisation.