Over the next few weeks, HM Revenue & Customs (HMRC) is sending out letters to approximately 560,000 taxpayers.
These letters are directed at individuals who have taxable income but aren’t currently in the Self Assessment system or can’t have their tax deducted automatically through PAYE.
The correspondence will include a detailed calculation of the tax you owe, so it is important to understand the actions you may need to take.
The simple assessment process
The simple assessment process is HMRC’s method for ensuring that taxpayers who fall outside the usual PAYE or Self Assessment systems still meet their tax obligations.
Essentially, it is a direct calculation sent to you by HMRC, detailing the amount of tax you owe and when it is due.
This is particularly relevant for many, including approximately 140,000 pensioners, who might be encountering this process for the first time.
The letter will provide all the necessary details to help you understand and settle your tax liability.
What to expect in your HMRC letter
When you receive your letter from HMRC, it will outline:
- The total tax owed based on your income from April 2023 to April 2024
- Clear instructions on how to pay, including the deadline, typically set for 31 January
- Guidance on what to do if you believe there’s an error in HMRC’s calculation
You have the option to pay the amount owed in instalments, provided the full sum is cleared by the due date.
Importantly, there’s no need to take any action until you actually receive the letter. If you don’t receive one, it likely means there’s no additional tax to pay.
Watch out for scams
As with any official communication, stay vigilant against potential scams.
Scammers may use this opportunity to send fraudulent letters, emails, or texts pretending to be from HMRC.
Remember, legitimate HMRC letters will provide specific details about your tax calculation and instructions on how to pay.
They will never request sensitive information through email or text.
If something seems off, do not engage. Instead, verify the authenticity by contacting HMRC directly through their official channels.
Key red flags include urgent language, threats of legal action, or offers that seem too good to be true. Always double-check any unexpected communication before proceeding.
If you have received a simple assessment letter and are unsure about your next steps, contact us to discuss any queries you may have.
