Older Brits are being urged to check their postboxes as HMRC sends out alarming tax letters, with pensioners among those most at risk of being caught out.
As the end of the tax year looms, hundreds of thousands of taxpayers across the UK will receive letters from the taxman.
These so-called ‘Simple Assessment’ or ‘Tax Calculation’ letters could mean one of two things – either you are owed a tax refund, or you have an unexpected bill to pay. And for some, that bill could run into the thousands.
A HMRC spokesperson said: “We’re currently issuing Simple Assessment letters for the 2023/24 tax year. Customers will automatically receive one if they owe tax that cannot be collected via their tax code or are not registered Self Assessment.”
Simple Assessment letters are sent to three specific groups of taxpayers:
* Pensioners whose State Pension pushes them over the tax threshold. Many retirees wrongly assume their pension is tax-free, but those exceeding their personal allowance will owe money.
* People who owe more than £3,000 in tax. This includes those with multiple sources of income or miscalculated tax codes.
* Workers whose tax cannot be automatically deducted through PAYE. If your employer hasn’t deducted enough tax, you could be in for a shock.
What happens if you ignore the letter?
Failure to act could result in fines and interest piling up on unpaid tax bills. Those who received letters before October31 2024 for the 2023/24 tax year were required to pay by January 31, 2025. If the letter arrives later, you have just three months to settle the bill.
What should you do next?
Recipients have 60 days to check their tax calculations and contact HMRC if anything seems wrong. If you can’t afford to pay, HMRC may agree to a payment plan – but only after the deadline has passed, meaning interest could be added in the meantime.
How to pay
- Online via HMRC’s portal
- Direct bank transfer
- By sending a cheque
HMRC will ask for detailed financial information, including your income, expenses, and savings. If you have assets or savings, expect HMRC to push for full repayment before they consider a payment plan.
Final warning
With an increasing number of pensioners and workers falling into tax traps due to miscalculations, it is crucial to read any HMRC letter carefully. If you receive one, don’t bin it – act fast or risk a financial nightmare!
