HMRC introduce Simple Assessment

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Posted on October 16, 2017

In September 2017, HMRC removed the need for some customers to complete a self-assessment tax return, starting with two groups. The groups are:

  • New state pensioners with income more than the personal tax allowance in 2016/17; and
  • PAYE customers who have underpaid tax and who cannot have their tax collected through their tax code.

Simple Assessment is a new way of collecting tax to reduce the administrative burden for some who have had to do Self-Assessment tax returns in the past.

HMRC state:

"HMRC will write to customers from September 2017 with a tax calculation. This could be a P800 or a Simple Assessment letter (PA302)."

This letter will show their:

  • Income from pay
  • Pensions
  • State benefits
  • Savings interest
  • Employee benefits

How it works

Rather than asking customers to fill in a return with lots of information, HMRC will now use data it already holds and calculate what tax is owed.

For individuals who have more complex tax affairs and who will continue to complete Self-Assessment tax returns, they will still benefit from this more modernised process in the future. These individuals will only be required to provide information which is needed to assess their tax, benefits and credits. HMRC will include the rest of the information automatically from their database.

What customers need to do next

Customers will need to check the information is correct, assuming this is the case they can pay their tax liability online or by cheque. The due date for payment of a Simple Assessment is the later of either 31 January following the end of the tax year to which it relates, or three months following the date of issue of the assessment.

If a customer thinks any information is incorrect they have 60 days to contact HMRC.

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