Around 11 million people have to complete a tax return every year to provide HMRC with information about their income. With greater 
use of existing data HMRC can now access the information for some of those taxpayers elsewhere. This means they won’t need to complete a tax return. This new system is called Simple Assessment.
This means that from September 2017 HMRC have removed the need for some taxpayers to complete a tax return, starting with two groups:
- new state pensioners with income more than the personal tax allowance in the tax year 2016 to 2017
- PAYE customers, who have underpaid tax and who cannot have that tax collected through their tax code
All existing state pensioners who complete a tax return because their state pension is more than their personal allowance will be removed from Self Assessment in the tax year 2018 to 2019.
Rather than asking taxpayers to fill in a return with lots of information, HMRC will now use data it already holds and calculate what tax is owed.
Taxpayers with more complex tax affairs who continue doing Self Assessment will still benefit from a modernised process in the future. This means they will only be asked for information needed to assess their tax, benefits and credits. HMRC will complete the rest of the information automatically.
HMRC will write to the two groups of taxpayers from this month with a tax calculation. This could be a P800 or a Simple Assessment letter (PA302).
The letter will show their:
- income from pay
- pensions
- state benefits
- savings interest
- employee benefits
Taxpayers will need to check the information is correct, and if it is they can pay their bill online or by cheque by the deadline in the letter.
However if they think any information is incorrect they have 60 days to contact HMRC. For instance, if they think amounts used are wrong or HMRC didn’t act on information received.
Should taxpayers miss the deadline they should contact HMRC to discuss their circumstances or financial penalties will be applied in line with current policy. If they still aren’t happy with the follow-up response from HMRC, they have 30 days to appeal against the decision.
