Simple Assessment – Is it the end of the Tax Return?

Category: Taxation - Posted On: Sep 26 2017


HMRC has now started the process of withdrawing the need to complete tax returns in certain circumstances. For example, if you became entitled to the state pension at some point after 6 April 2016 but continued to have another source of income such as employment income, then you may be due to pay tax on your state pension. This is because the state pension does not have any tax deducted from it at source and all of your allowances may have been used up by your employment income. This would have required you to complete a tax return to declare the untaxed state pension income, even though HMRC already have information about your state pension income on their records.

Now HMRC will be able to issue a simple assessment and withdraw any notice that may have already been issued to complete a tax return. If you have already completed and submitted a tax return then a simple assessment should not be issued.

Simple assessments will only be issued where HMRC have all the necessary information from you or third parties such as employers, pension providers or banks. It will show all income and gains to be taxed and detail any available allowances and reliefs. It will then show the tax payable and the date it requires to be paid. Tax will continue to be payable by 31 January following the end of the tax year. However if the assessment is issued after 31 October, following the end of the tax year, it will then become payable three months after the date of the assessment.

You can appeal against the assessment if you think it is wrong but first you have to follow a new procedure of raising a query on the assessment. Only if your query is not satisfactorily resolved can you make a formal appeal.

You may not have to complete a tax return but may want the comfort of a professional adviser checking the assessment on your behalf and making sure you are paying the right amount of tax and claiming all reliefs available to you. Tax is not simple and HMRC do not always get it right first time.

For more information, or to speak to a member of our taxation team, contact your local office or email taxation@eqaccountants.co.uk.