HM Revenue & Customs (HMRC) has begun issuing 1.8 million letters over the summer about Simple Assessment, urging people who receive one not to ignore it. The letters, known as PA302, are separate from Self Assessment and explain how much tax is owed and why.
What is Simple Assessment?
Simple Assessment applies to people who owe income tax that cannot be taken automatically from their income, owe HMRC more than £3,000 from a previous tax year, or have to pay tax on their State Pension.
It can also apply if a taxpayer received more tax-free allowance than they were entitled to, or when tax cannot be collected through a tax code. Common reasons for a letter include tax owed on savings or dividends, an untaxed second income, or tax due on pension income.
Payment deadline and details
Any tax owed must be paid by January 31 next year unless a different date is shown on the letter. Each letter shows the recipient's taxable income, income tax already paid, the amount of tax owed, a reference number and the payment deadline.
HMRC said recipients should check the figures in their letter against their own records.
How to pay
Payments can be made through the HMRC app, by bank transfer, cheque or over the phone. Anyone who cannot pay the full amount in one go can pay in instalments by calling HMRC on 0300 322 7835.
Myrtle Lloyd, HMRC's chief customer officer, said: "If you receive a Simple Assessment letter and have tax to pay, please don't ignore it. It is quick and easy to pay any tax owed via the HMRC app."
What to expect from the letter
The letters are official and will arrive by post or appear in a person's Personal Tax Account online. The letter also explains what happens if payment is not made or HMRC is not contacted within 28 days of receiving it.
When letters are sent
People of working age began receiving letters from June 30, while pensioners will start receiving theirs from August 12. A second batch of letters is due to be sent between October and December, relating to data on bank and building society interest.
