By Jonathan Davies

End-of-year paper tax returns will be scrapped by 2020 and replaced by "digital tax accounts", the Chancellor George Osborne will announce in the Budget today (Wednesday).

Mr Osborne will reveal the plans to switch to a digital service, which will end of annual rush to file tax returns in time.

Individuals and small businesses will be able to file their returns via an online portal from their laptop, tablet or phone.

The system will also allow people to pay their tax throughout the year, spreading the cost through installments.

The portal will show how HMRC calculates tax, with the tax authority regularly updating information available to the public.

In 2016, five million small businesses and 10 million individuals will be switched to the digital system. And by 2020, businesses should be able to link their account to their accounting software, allowing them to feed information directly to the tax account.