HMRC to issue tax calculations on bank interest from late September: what to check in P800 and PA302

HMRC has warned of a new wave of tax calculations. From late September 2026, it will start issuing P800 calculations or Simple Assessment notices (PA302) where tax is due on bank and building society interest earned between April 2025 and April 2026. Banks and building societies report the interest directly to HMRC.

Who may receive a letter?

P800 or PA302 letters are generally sent to employees and pensioners where the tax paid by the end of the year was too high or too low. People already registered for Self Assessment report savings interest on their return; their bill is normally adjusted through the return instead of a separate calculation letter.

If the underpayment can be collected through PAYE, HMRC will normally adjust the tax code. If that is not possible, or the tax owed is more than £3,000, HMRC may issue a PA302 explaining how and when to pay.

Why might a second notice arrive for the same year?

HMRC says some taxpayers may already have received a Simple Assessment for 2025/26 that did not include bank or building society interest. Once updated information arrives from the bank, HMRC may send a second assessment for the same tax year.

The new figure is the total tax due for the year. It includes the amount shown on the first notice even if that amount has already been paid. Do not pay the whole total twice: subtract any payment already made. If the first assessment was £300 and paid in full, and the new one shows £450, the remaining amount is £150.

What should you check before paying?

Compare the interest figures with statements for every bank and building society account held during 2025/26. HMRC normally splits interest on a joint account equally between the account holders unless told otherwise. Also check previous payments and the figures for employment, pensions and taxable benefits.

A PA302 contains a 14-character payment reference beginning with X. If the calculation is wrong, GOV.UK says to contact HMRC within 60 days. If it is correct, pay by the deadline in the letter: for a 2025/26 notice received before 31 October 2026, payment is due by 31 January 2027; a later notice normally allows three months.

How much savings interest is tax-free?

The Personal Savings Allowance depends on the taxpayer’s band: up to £1,000 for a basic-rate taxpayer, £500 for a higher-rate taxpayer and £0 for an additional-rate taxpayer. People with low other income may also qualify for the starting rate for savings of up to £5,000, which reduces as wages or pension income rises. Interest from ISAs and certain National Savings and Investments products is not included.

Tax applies only to interest above the available allowances, not to the amount held in the account. HMRC may also use the previous year’s interest to estimate current-year income in a PAYE tax code, so that estimate is worth checking in the Personal Tax Account.

When is Self Assessment required?

If savings and investment income is more than £10,000, it must be reported on a Self Assessment tax return. Anyone already filing a return for another reason must include savings interest regardless of the amount. If the filing obligation is new, check the 5 October registration deadline.

What should you do now?

Gather bank statements and annual interest certificates, check messages in your Personal Tax Account and do not ignore a paper letter. If a second PA302 arrives, find proof of the first payment and calculate only the difference. This article is general information, not personalised tax advice.