If you’ve recently received a Simple Assessment letter from HMRC, you might be wondering what it means, why you have been sent one, and what you need to do next.

HMRC has introduced a new Self-Service Time to Pay option for anyone with a Simple Assessment debt. This means that if you can’t pay in one go, you can now set up a payment plan online and spread the cost into affordable monthly payments.

But first, it helps to understand exactly what a Simple Assessment is, why HMRC sends one, and how it affects the tax you owe. Knowing this will make it easier to follow the rest of the steps, including how to pay or set up a Time to Pay plan.

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What is a Simple Assessment?

A Simple Assessment is HMRC’s way of telling you how much tax you owe, without asking you to fill out a Self Assessment tax return.

The letter sets out:

• How much tax you owe.
• When it needs to be paid (usually by the 31st of January the following year).
• How to pay.
• What to do if you disagree with the calculation. 

These assessments are becoming more common, especially for people who don’t normally submit a tax return. For example, one of the most common reasons is to collect tax owed on the State Pension (which can be taxable if your income goes above a certain threshold). 

How do I pay my Simple Assessment?

Your Simple Assessment letter will outline how much you owe and when it needs to be paid. Here are all the standard ways you can settle the bill:

1. Pay online

• Via a bank account.

You can pay online by signing in to your bank account through the HMRC website or Personal Tax Account. You’ll need the 14-character reference that begins with “X” (from your letter) to ensure the payment reaches the right place. 

• Through the HMRC app

The app lets you pay using your phone by linking to your bank’s app. It’s fast, convenient, and mobile-friendly.

2. Bank Transfer

You can pay using a bank transfer (Faster Payments, CHAPS, or Bacs) directly to HMRC’s bank account specified on GOV.UK. Use the payment reference from your letter so the payment is allocated correctly. 

3. Pay by Cheque

Write a cheque to “HM Revenue and Customs,” include your reference on the back. The correct address will be shown on your letter. 

4. Other methods (less common)

While standard Simple Assessment payment options are limited to online, bank transfer, or cheque, similar HMRC pages for Self Assessment show additional methods such as:

• Debit or corporate credit card

Accepted online for Self Assessment, but a fee may apply. Personal credit cards aren't accepted.

• Paying in person at a bank/building society using a paying-in slip from HMRC.

These aren’t typically listed for Simple Assessments, so it’s safest to stick to the three main methods above unless your letter explicitly states otherwise.

What if I disagree with the bill?

If you think HMRC has made a mistake, you'll need to act quickly. You should contact them within 60 days of receiving your Simple Assessment letter. You can contact HMRC by phone or in writing to say which figures you believe are incorrect and what they should be.

If HMRC agrees, they’ll issue a corrected assessment. If not, you’ll receive a decision letter explaining why, how to pay, and how to appeal (you then have 30 days from that decision to appeal further). You must still pay by the deadline unless HMRC expressly gives you longer. 

What if I can’t pay my Simple Assessment?

If your Simple Assessment bill feels too much to handle, you are not alone. This is exactly why HMRC has introduced the new Self-Serve Time to Pay service.

In the past, if you could not pay a Simple Assessment in one go, you had to call HMRC, wait on hold, and explain your circumstances. Now you can manage it yourself online in just a few minutes.

With Self-Serve Time to Pay, you can:

• Set up a payment plan online without speaking to anyone.
• Spread the cost into smaller monthly payments that suit your budget.
• Avoid late payment penalties as long as you keep to the plan.
• Stay in control by knowing exactly how much is leaving your account and when.

Most people will qualify for this service if they meet the following conditions:

• The total tax bill is less than thirty thousand pounds
• They do not already have another active Time to Pay arrangement
• The plan is set up before the payment deadline shown on the Simple Assessment letter

This new option can be a real lifeline, especially if your bill comes as a surprise or you are on a fixed income, such as a State Pension. It gives you a way to manage what you owe in a practical and affordable way, rather than struggling to pay it all at once.

You can set up a plan through your Personal Tax Account or by using the HMRC app once your Simple Assessment letter arrives.

Spread the cost with Self-Serve Time to Pay

Receiving a Simple Assessment from HMRC can feel worrying, especially if it comes as a surprise. The good news is that you do not have to pay the full amount in one go. With the new Self-Service Time to Pay service, you can spread your tax bill into manageable monthly installments that fit your budget.

Check the details in your letter, set up a payment plan before the deadline, and if anything doesn’t look right, make sure to contact HMRC promptly to query the calculation. By acting early, you can stay in control of your finances, avoid unnecessary penalties, and manage your Simple Assessment with confidence.

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