Are you one of the two types of people no longer required to submit a self-assessment tax return?
Simple Assessment first took effect in September 2017, which means some taxpayers no longer need to disclose information about their income via a self-assessment tax return.
The term ‘Simple Assessment’ may ring a bell, it’s a term that has been bandied about for the past few years and, is in essence, a new, simpler way of collecting tax. Instead of taxpayers having to fill in a self-assessment tax return with the same information year-on-year, HMRC will simply use the data they already hold to calculate how much tax is owed.
For now though, only two types of people will pay their tax through Simple Assessment:
• New state pensioners with an income higher than the personal allowance in the tax year 2016/17
• PAYE customers who underpaid tax and can’t have tax collected through their tax code
In addition to this, any state pensioners that complete a tax return because their state pension is higher than their personal allowance will be removed from self-assessment from April 2018.
This is the beginnings of a much larger plan to allow all taxpayers to pay tax via simple assessment. HMRC are currently sending letters to affected customers with a tax calculation using P800 or PA302 forms, these letters will detail the individual’s salary, pension, state benefits, savings interest and employee benefits.
The two types of people who qualify for Simple Assessment will simply need to check that the information is correct and pay their bill either online or by cheque. However, if the information is incorrect, taxpayers will have a maximum of 60 days to notify HMRC of any changes.