Simple assessments

Produced by Tolley

The following Personal Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Simple assessments
  • Who might receive a simple assessment?
  • What is included in the simple assessment?
  • Objecting to the simple assessment
  • Right of appeal
  • Deadline for paying the tax due
  • Payment of tax
  • Penalties and interest
  • Interaction with the requirement to notify chargeability
  • Real time transaction tax return

Simple assessments

From 2016/17 onwards, HMRC has the power to make a ‘simple assessment’ of the taxpayer’s income tax and / or capital gains tax liability outside of the self assessment system.

As HMRC already receives significant amounts of information on the income received and tax paid by taxpayers via existing data-gathering channels, including the information provided by employers under real time information (RTI), simple assessments may make it easier for individuals with straightforward tax affairs to comply with their obligations.

As was expected when simple assessments were introduced, HMRC announced in September 2017 that it would be moving the following groups out of the self assessment regime and would issue simple assessments instead:

Taxpayer circumstancesComment
State pensioners with income that exceeds the personal allowanceRemoval of these taxpayers from self assessment phased-in over a two-year period, with new state pensioners being moved across first.
According to the October 2017 HMRC Talking Points webinar on simple assessments, this applies to state pensioners where the state pension is their only source of income. In future years, those state pensioners with other income, such as savings income, may also be moved into simple assessments
Individuals with employment or pension income who have underpaid tax that cannot be collected through their PAYE tax codesThe maximum amount that can be collected through an individual’s PAYE tax code is £3,000. Therefore, it is expected that most of the simple assessments issued to these taxpayers will be in respect of amounts due that exceed £3,000.
Amounts of less than £3,000 might be charged through a simple assessment if the amount is such that it cannot be collected via the tax code due to the overriding limit, which prevents more than 50% of the net PAYE income in the payment period being deducted as tax.
See the Collection of tax underpayments via PAYE tax code guidance note

However, HMRC announced that progress on migrating taxpayers into the simple assessment regime

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