Severn Accounting
Tax & Accounting

Dealing with a Simple Assessment letter

By Ali Jaw ·

Simple Assessment is used by HMRC to collect tax underpayments from taxpayers with straightforward tax affairs. It removes the need for the taxpayer to complete a Self Assessment tax return. If you’ve received a Simple Assessment letter, you’re not alone — thousands of UK taxpayers do each year. Whilst it might feel daunting at first, understanding what it means and how to respond is straightforward. This guide walks you through the process and explains your options.

What is Simple Assessment and why might you receive one?

HMRC uses Simple Assessment when they believe you’ve underpaid tax, but your circumstances are simple enough that you don’t need to file a full Self Assessment return. This typically applies to individuals with one source of income—perhaps employment, a pension, or modest rental income—where the calculation is clear-cut.

You might receive a Simple Assessment letter if:

  • Your employer or pension provider has submitted incorrect information to HMRC
  • You’ve had a change in circumstances (such as part-time work or a new job) that wasn’t communicated properly
  • There’s been an error in your tax code
  • You’ve had untaxed income that HMRC has only recently identified

The key advantage of Simple Assessment is that HMRC does the maths for you. You’re not required to complete a Self Assessment tax return or navigate the complexities of the online portal—HMRC simply tells you what they believe you owe.

Understanding your Simple Assessment letter

When you receive a Simple Assessment letter, it will set out:

  • The tax year in question
  • Your estimated income
  • The tax that should have been paid
  • Any tax already deducted (such as PAYE)
  • The amount you owe (or a refund due)
  • The deadline for payment (usually 60 days from the letter date)

Take time to review the figures carefully. Check that HMRC has the right employment history, pension details, and any other income sources. If something looks wrong—perhaps a second job isn’t listed, or a period of unemployment isn’t accounted for—you should challenge it.

What to do if you disagree with the assessment

You have the right to dispute a Simple Assessment. If you believe HMRC’s figures are incorrect, contact them with evidence to support your position. This might include:

  • Payslips showing different earnings
  • Pension statements
  • P45 forms or employment contracts (if there are gaps in employment)
  • Records of expenses (if you’re self-employed or have business income)

Keep copies of everything you send. HMRC typically responds within 30 days, though complex queries may take longer. During this time, you don’t usually need to pay the assessment—though you should check your letter for specific instructions.

Paying your Simple Assessment

If you agree with the assessment, payment is due within 60 days of the letter date. You can pay online via HMRC’s website, by post, or through your bank using the payment reference provided in your letter.

If you’re struggling to pay the full amount, don’t ignore the letter. Contact HMRC to discuss a payment arrangement. They’re often willing to discuss instalments, particularly for larger amounts. The earlier you get in touch, the more flexible they’re likely to be.

Interest will be charged on late payments. As of the current tax year, the late payment interest rate is set by HMRC and applied daily. On top of this, penalties may apply if payment remains outstanding for more than 12 months.

When Simple Assessment doesn’t apply

It’s worth noting that Simple Assessment only works for relatively straightforward situations. If you have:

  • Self-employment income
  • Multiple sources of employment
  • Complex deductions or reliefs
  • Investment income or capital gains

…then HMRC may issue a formal assessment instead, or request that you file a Self Assessment return. In these cases, you’ll typically have 12 months from the end of the tax year to file.

Moving forward

Once you’ve resolved a Simple Assessment, take steps to prevent similar issues arising. Check your tax code annually (particularly after a job change), ensure your employer has up-to-date information, and keep records of all income sources. If you’re unsure whether you need to file a Self Assessment return, it’s better to ask than to assume.

Simple Assessment is designed to be straightforward, and in most cases, it is. The key is to act promptly when you receive a letter, review the figures carefully, and get in touch with HMRC (or a professional adviser) if anything seems amiss.

For tailored advice, contact Severn Accounting — we’re here to help.