Carelessness is the most common reason for small businesses and individuals failing to pay the right tax, according to HMRC.
A policy paper on tackling tax evasion and avoidance published after Spring Statement 2019 said the introduction of Making Tax Digital (MTD) will help address the problems.
"In most cases, these individuals and businesses, the Government, and HMRC are all trying to achieve the same goal: to get their tax right.
"Because the most common problems HMRC finds with these taxpayers are errors and carelessness, HMRC's focus is to help make and keep tax compliance as straightforward as possible."
The Revenue added that MTD will help to reduce the risk of errors that can result from keeping records on paper and manually entering them into an online return.
By cutting down on these inaccuracies, the scheme is expected to deliver an additional £1.2bn in tax receipts by 2023/24.
The first stage of MTD is set to take effect from 1 April 2019, requiring VAT-registered businesses with a turnover above £85,000 to use digital tools for VAT record-keeping and returns.
Talk to us about Making Tax Digital.