HMRC is set to dispatch automatic tax calculation letters to pensioners starting from 12 August 2026, marking the first such correspondence under Prime Minister Andy Burnham's administration. The letters, officially known as PA302 and part of the Simple Assessment system, are being issued to individuals who owe tax that cannot be collected through their tax code or other automatic means.
Who Receives a Simple Assessment Letter?
Customers may receive a Simple Assessment tax calculation letter if they have tax to pay that HMRC cannot collect automatically. Common reasons include tax due on interest from savings or dividends, a second income that has not been taxed, or tax due on pension income. Additionally, individuals who have received more tax-free allowance than they are entitled to may be contacted. Letters are also sent when the tax cannot be collected through a tax code, typically for larger amounts owed of £3,000 or more.
Timeline and Volume of Letters
Working-age letters began arriving in July 2026, shortly before Mr Burnham became Prime Minister. Pensioners will start receiving their letters from 12 August 2026, HMRC confirmed. The tax authority will issue approximately 1.8 million Simple Assessment letters in total this year. This is a routine annual process, according to HMRC, with letters automatically generated when data is received from employers, the Department for Work and Pensions (DWP), and financial institutions.
Political Context
The HMRC drive is the first under Prime Minister Andy Burnham and the first since John Healey became Chancellor of the Exchequer, replacing Rachel Reeves. Specific ministerial oversight of HMRC falls under HM Treasury, led by Chancellor John Healey. Previous chancellors include Rishi Sunak under the Conservative government and Rachel Reeves under the prior Labour administration. Mr Burnham has recently ruled out two rumoured tax changes for households in England, signaling his government's approach to fiscal policy.
What to Do If You Receive a Letter
Myrtle Lloyd, HMRC's Chief Customer Officer, urged recipients not to ignore the letter. “If you receive a Simple Assessment letter and have tax to pay, please don’t ignore it. It is quick and easy to pay any tax owed via the HMRC app,” she said. “If you need extra support, or want to find out more, search ‘Simple Assessment’ on GOV.UK.”
People should check the figures in their letter against their own records and pay any tax owed by 31 January 2027, unless a different date is shown. Payments can be made in full or in instalments before the deadline, and a tax return is not required. The HMRC app and online portal offer convenient payment options.
How Payments Work
Taxpayers can pay the amount due through the HMRC app, online banking, or by other methods detailed on GOV.UK. Instalment plans are available for those who cannot pay in full immediately, but the total must be cleared by the deadline. Late payment may incur interest or penalties, so timely action is advised.
Background on Simple Assessment
Simple Assessment was introduced to simplify tax collection for straightforward cases where individuals have tax to pay but do not need to file a full self-assessment tax return. The system relies on data from third parties such as employers, pension providers, and banks. Each letter includes a unique reference number and details of the tax calculation. HMRC emphasizes that this is a routine process and not a sign of an audit or investigation.
For further information, taxpayers can visit the Simple Assessment page on GOV.UK or contact HMRC directly. The helpline and online chat services are available for those needing extra support.
