Written by Hammad Rasool MAAT·AAT licensed accountant·Updated November 2026
Budget 2026 update: A new Pension Tax Allowance runs from 6 April 2027 to 5 April 2030, so pensioners whose total income is no more than the full new State Pension will not have to pay small amounts of Income Tax through Simple Assessment. See everything that changed.

What a Simple Assessment is

HMRC sends a Simple Assessment letter when you owe Income Tax that cannot be taken automatically from your wages or pension. The letter is often marked PA302. According to GOV.UK you may get one if:

  • you owe tax that cannot be collected automatically from your income
  • you owe HMRC more than £3,000
  • you have tax to pay on your State Pension

It is common among pensioners whose State Pension has grown above their Personal Allowance, and among people with savings interest that their tax code did not cover.

When you have to pay

For the 2025/26 tax year (6 April 2025 to 5 April 2026):

  • Letter dated before 31 October 2026: pay by 31 January 2027.
  • Letter dated on or after 31 October 2026: pay within 3 months of the date on the letter.

You pay online through GOV.UK using the 14 character payment reference on the letter, which starts with an X. You can also pay through your Personal Tax Account or the HMRC app.

Key point: a Simple Assessment is a legal demand for tax. Missing the payment date leads to interest and can lead to late payment penalties, so put the date in your diary on the day the letter arrives.

Check the figures

The calculation uses information from employers, pension providers, the Department for Work and Pensions and banks. Check each income figure against your own records: P60s, pension statements, the State Pension amount and bank interest certificates. Also check that allowances you are entitled to, such as Marriage Allowance, appear.

If you think it is wrong

You must contact HMRC within 60 days of the date on the letter. Tell them which figures you disagree with and why. If you leave it longer than 60 days you can lose the right to challenge the bill, so act early even if you are still gathering paperwork.

Example

Mr Hughes, aged 71, receives a Simple Assessment for £412. The letter includes £1,900 of bank interest, but £1,100 of that was earned in a joint account with his wife and only half was his. He contacts HMRC within the 60 days with the bank certificate and the bill is reduced.

If you cannot pay in one go

Contact HMRC before the deadline. You may be able to set up a payment plan to pay in instalments. HMRC will look at your income and spending to check the plan is affordable.

Common questions

Is a Simple Assessment the same as Self Assessment?
No. With Self Assessment you complete a tax return. With Simple Assessment HMRC works out the bill for you from information it already holds, and you just check it and pay.
Do I need to file a tax return if I get a Simple Assessment?
No, not for the income covered by the letter. If you have other untaxed income HMRC does not know about, you must tell HMRC.
What is the difference between a P800 and a Simple Assessment?
A P800 is usually settled through your tax code or by a refund. A Simple Assessment is sent when the tax cannot be collected automatically, so you have to pay HMRC directly by the deadline.
How long do I have to challenge a Simple Assessment?
60 days from the date on the letter.

Checked against GOV.UK on 10 November 2026: Simple Assessment, If you cannot pay your tax bill on time.

About the author

Hammad Rasool MAAT is an AAT licensed accountant based in Bolton. TaxTune Accountants looks after sole traders, landlords, contractors and limited companies in Bolton, Wigan, Bury, Salford, Oldham, Stockport and Manchester, and online across the UK.