HMRC’s New ‘Simple Assessment’
HMRC has changed the way in which they will assess some taxpayers, removing the need for these individuals to complete a Self-Assessment Tax Return. These changes took effect from September 2017.
Those individuals fall into these categories:
• new state pensioners with income more than the personal tax allowance (£11,000) in 2016/17; and
• employees or pensioners with PAYE tax codes who have underpaid tax and who cannot have that tax collected through their tax code, because it is too high to code out.
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 2017/18. This may mean that some clients are dropped out of self-assessment and issued an assessment instead based on the information which HMRC hold.
HMRC will write to customers from September 2017 with a tax calculation. This could be a P800 or a Simple Assessment letter (PA302)’.
If you receive the letter it will show your:
• income from pay
• state benefits
• savings interest
• employee benefits.
Clients 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.
If a client thinks any information is incorrect they have 60 days to contact HMRC.
Should clients miss the deadline they should contact HMRC to discuss their circumstances or financial penalties will be applied in line with current policy. If clients are not happy with the follow-up response from HMRC, they have 30 days to appeal against the decision.
With all the reported errors in the HMRC’s own computer systems, we wonder at how correct these assessments will be?
Clients can always contact us for further assistance or information
Disclaimer:- The information contained herein is given by way of general guidance only and no action should be taken solely on the basis of the information contained herein. The Avanti Group (UK) Ltd will be pleased to provide further guidance on the issues, and how they might affect you. No liability is accepted by the firm for any action taken without seeking appropriate professional advice