HMRC's Simple Assessment scheme lets HMRC calculate your income tax bill and send you a demand to pay -- without requiring you to file a Self Assessment tax return. It sounds convenient, but there is a catch: HMRC may not have accurate information about all your income and reliefs, so errors are possible. If you have received a PA302 Simple Assessment letter, you have 60 days to check it and dispute any errors before the tax becomes formally due. This guide explains exactly how Simple Assessment works in 2026, who is selected, how to verify the figures, how to pay, and what to do if something is wrong.
Who Receives a Simple Assessment?
HMRC targets Simple Assessment at taxpayers who owe income tax that cannot be easily collected through PAYE, but whose tax affairs are straightforward enough that HMRC believes it has sufficient third-party data to calculate the liability accurately. The main groups are:
- New State Pension recipients: People who began receiving the new State Pension and whose total income (State Pension plus other sources) exceeds their Personal Allowance, particularly where they did not previously file Self Assessment returns. The State Pension is taxable but paid without deduction of tax, creating an underpayment.
- High earners with PAYE income above GBP 100,000: Those who received more than GBP 100,000 in salary or pension and had their Personal Allowance tapered but whose employer's PAYE deductions did not fully reflect the abatement.
- People with modest untaxed investment income: HMRC receives data on savings interest from banks and building societies, and dividend information from companies. Where these amounts create a small tax liability and no other complicating factors exist, HMRC may issue a Simple Assessment rather than requiring a full return.
- Former Self Assessment filers with simplified circumstances: People who have come out of Self Assessment (for example because they retired and stopped receiving self-employment income) but still have residual untaxed income.
Understanding Your PA302 Letter
The PA302 is typically a two or three page letter from HMRC showing:
- The tax year the assessment covers
- Your total income by source (salary, pension, State Pension, savings interest, dividends, etc.)
- The Personal Allowance applied (GBP 12,570 for 2026/27, potentially reduced above GBP 100,000)
- The total income tax liability calculated
- Tax already paid (via PAYE or at source)
- The amount you still owe
- The payment deadline
- How to pay and how to dispute the assessment
HMRC may also issue the PA302 digitally via your Personal Tax Account if you have registered for online services and elected for paperless correspondence.
How to Check Your Simple Assessment for Errors
Before paying, work through the PA302 systematically:
- Check all income figures: Compare each income figure against your P60 (employer and pension), State Pension letter (DWP annual statement), bank savings interest statements, and dividend certificates. HMRC sometimes uses estimates when it does not yet have the final figure from a third party.
- Check the Personal Allowance: Confirm GBP 12,570 has been used (or the reduced amount if your income exceeds GBP 100,000). If you transferred part of your Personal Allowance to or from your spouse under Marriage Allowance, check this is reflected.
- Check for missing reliefs: HMRC's Simple Assessment may not automatically include all reliefs you are entitled to -- for example, contributions to non-PAYE pension schemes, Gift Aid donations, or professional subscriptions. If you have unclaimed reliefs, you should dispute the assessment and provide details.
- Check dates: Make sure the letter relates to the correct tax year (6 April to 5 April) and that all income falls within that period.
How to Pay a Simple Assessment
You can pay your Simple Assessment tax bill online via the HMRC payment service (search "pay Simple Assessment" on gov.uk), by bank transfer using the reference number shown on your PA302, or by setting up a payment plan if you cannot pay in full. The payment reference is your 15-digit Simple Assessment reference number -- do not use your UTR or NI number. If you want to spread payments, contact HMRC before the deadline to arrange a Time to Pay agreement; interest will still accrue on the outstanding balance.
Disputing a Simple Assessment -- The 60-Day Window
You have 60 days from the date on the PA302 to tell HMRC you disagree with the calculation. Do not wait until closer to the payment deadline. To dispute:
- Identify exactly which figure is wrong and gather your evidence (P60, bank statements, etc.)
- Contact HMRC by phone (0300 200 3300), online via your Personal Tax Account, or in writing to the address on the PA302
- Explain which figure is incorrect and provide the correct amount with documentary support
- HMRC will review and either issue a revised PA302 with the corrected liability or write to you confirming the original assessment is correct
- If HMRC confirms the original and you still disagree, you can appeal to the First-tier Tax Tribunal within 30 days of HMRC's review decision
While a dispute is pending, HMRC may agree to postpone the payment deadline, but this is not automatic -- you should ask explicitly when you contact HMRC.
Simple Assessment vs Self Assessment -- Which Is Better?
Simple Assessment is genuinely simpler for people with straightforward, accurately-reported income sources. However, it has limitations: HMRC can only include reliefs and deductions it knows about. If you have significant Gift Aid donations, pension contributions to personal pensions, rental losses to carry forward, or business expenses, these will not appear on a Simple Assessment unless you report them. In these cases, filing a full Self Assessment return gives you greater control and may result in a lower tax bill. If you believe you have unclaimed reliefs exceeding the amounts HMRC is aware of, consider asking HMRC to add you to Self Assessment rather than continuing with the Simple Assessment route.
