Simple Assessment: what to do if HMRC sends you a tax bill — deadlines and how to pay

If HMRC decides you have underpaid Income Tax but cannot collect it through your tax code, it sends a Simple Assessment letter — a ready-made bill. For the 2025/26 tax year HMRC is issuing around 1.8 million of these letters. It is not a fine and not a means test: HMRC has worked out the figure, and all you have to do is check it and pay on time.

Who gets a Simple Assessment letter?

The bill goes to people with tax that cannot be collected automatically. According to GOV.UK, you may get one if you owe Income Tax that cannot be taken through your tax code, owe £3,000 or more, have to pay tax on your State Pension, or have untaxed income such as savings interest or dividends. The bill itself is called a PA302 and arrives by post or in your Personal Tax Account.

Why does the State Pension create a tax bill?

The State Pension is paid without tax deducted, but it still counts as taxable income. If it plus your other income goes above the £12,570 tax-free Personal Allowance, tax becomes due. HMRC's example: a State Pension of £16,000 plus a private pension of £1,500 is £17,500. After the £12,570 allowance, £4,930 is taxed at 20%, giving £986. £750 is already collected through the private pension's tax code, so HMRC collects the remaining £236 through Simple Assessment.

By when must you pay?

The deadline depends on the letter's date. If the letter is dated before 31 October 2026 (for the year 6 April 2025 to 5 April 2026), pay by 31 January 2027. If it is dated on or after 31 October 2026, you have three months from the date of the letter. You can pay in full or in several smaller payments, but the whole amount must arrive by the deadline. You do not need to file a tax return.

How to pay and what to do if it is wrong

First check the bill at GOV.UK: Check your Simple Assessment tax bill, which shows the income, interest and benefits used. If it is correct, pay through the HMRC app, online at GOV.UK, by bank transfer or by cheque. Use the 14-character payment reference from your letter that starts with "X": a wrong reference can delay the payment or apply it to someone else's bill. If you think the details are wrong, contact HMRC within 60 days of the letter. HMRC's message is simple — do not ignore the letter, or interest will start building on the unpaid amount.