HMRC recovery activity using simple assessment

HMRC is issuing simple assessments for around 311,000 PAYE cases that were previously held back.

HMRC’s annual report included the following comment on the introduction of simple assessment:

‘We introduced Simple Assessment as a new, straightforward way for customers with simple tax affairs to pay tax which cannot be collected through PAYE, without them having to complete a tax return. Regrettably, we experienced a number of issues, including a delay in delivering the complex IT changes required, which meant that about 311,000 customer accounts could not be reconciled as we planned. We’ll be undertaking further analysis and recovery activity and will reconcile these accounts in 2019-20.’

The cases that were held back were those that involved multiple tax years. HMRC has now made the necessary systems changes to allow it to deal with multiple years and is issuing the simple assessments for these cases over the period November 2019 to March 2020.

Further information on simple assessment is available in TAXguide 09/18: Simple Assessment.

HMRC has also confirmed that it has no current plans to charge interest or late payment penalties in these cases.

Simple assessment will in time be extended to further categories of taxpayer; HMRC estimates that 500,000 simple assessments will be raised annually for the groups that it currently applies to.