Nearly 2 million people across the UK should keep a close eye on their post, because HM Revenue & Customs (HMRC) is sending out letters telling them they may have paid the wrong amount of tax. According to a report in the Worcester News, these HMRC unpaid tax letters are going to a large number of taxpayers who could either owe money or, in some cases, be due a refund.
The letters relate to how much Income Tax was collected during the tax year. When the figures do not add up, HMRC reviews the account and writes to the person to explain the difference. If you receive one, it is worth opening it promptly rather than setting it aside.
Below is a plain-English guide to what these notices mean and what you should do next. Where the reporting does not spell out a specific detail, that is stated clearly rather than guessed at.
Why is HMRC sending unpaid tax letters to nearly 2 million people?
HMRC checks the tax records of employed people and pensioners after the tax year ends. The system that collects tax at source, known as PAYE, does not always take exactly the right amount. Differences can build up for several reasons, for example:
- More than one source of income: having a second job or a pension alongside wages can throw the calculation off.
- Changing jobs during the year: starting or leaving employment can leave your tax code out of step.
- Company benefits: perks such as a company car or medical insurance can affect what you owe.
- Untaxed income: savings interest or other income not taxed at source can create a shortfall.
When HMRC spots a gap, it issues a calculation letter to put the account right. The Worcester News reports that close to 2 million people are being contacted in this round.
What does the HMRC letter actually say?
The letter sets out HMRC’s view of your tax position for the year. In most cases this is a tax calculation, often referred to as a P800 or a simple assessment, showing whether you have underpaid or overpaid.
- If you underpaid: the letter explains how much you owe and how it will be collected.
- If you overpaid: the letter explains that you are due money back and how the refund will be paid.
The exact amounts vary from person to person and are not the same for everyone, so the figure on your letter is specific to your record. The source does not give a single fixed sum that applies to all recipients, because it depends on individual circumstances.
How do I check whether the letter is genuine?
Because so many letters are going out, it pays to be careful about scams. Criminals often copy official branding to trick people into handing over money or bank details. To stay safe:
- Log in to your own account: use your Personal Tax Account on GOV.UK to view your tax position directly, rather than clicking links in an unexpected message.
- Be wary of pressure: genuine HMRC contact will not demand instant payment by unusual methods or threaten immediate arrest.
- Check contact details independently: find HMRC’s phone numbers on GOV.UK instead of using a number provided in a suspicious message.
If anything looks off, treat it as suspect until you have confirmed it through the official GOV.UK service.
How do I pay if I owe tax?
If the letter shows you underpaid, HMRC usually collects the money in one of two ways. First, it can adjust your tax code so the amount is spread across future pay or pension over the coming year, which means you pay a little more each month rather than a lump sum. Second, in some situations you may be asked to pay directly.
The letter you receive should state which method applies to you and give the timescale. If you cannot afford to pay what is due, HMRC can sometimes arrange a payment plan, so it is worth contacting them rather than ignoring the letter.
What if I’m owed a refund instead?
Not every letter is bad news. Some people will learn they paid too much and are due money back. If your calculation shows an overpayment, the letter explains how the repayment will reach you. In many cases HMRC can pay the refund automatically or through your online account.
For example, if you changed jobs midway through the year and your tax code was wrong for a few months, you might have overpaid without realising it, and the letter could tell you a refund is on the way.
What should I do if I think the calculation is wrong?
You are not obliged to simply accept the figure. If you believe HMRC has made a mistake, you can question it. Practical steps include:
- Read the breakdown carefully: check the income, tax codes and benefits listed against your own records, such as your P60 and payslips.
- Gather your evidence: keep documents that show your actual income and any benefits you received.
- Contact HMRC: use the details on GOV.UK or in the letter to explain why you think the figures are wrong.
Because the calculation depends on information HMRC holds, correcting an error usually means giving them the accurate figures so they can revise the assessment.
The bottom line for recipients
The main message from the Worcester News report is straightforward: check your post. With HMRC contacting nearly 2 million people about unpaid or overpaid tax, opening the letter quickly lets you sort out any money you owe or claim back anything you are due. Verify the letter through your official GOV.UK Personal Tax Account, and if the numbers do not look right, raise it with HMRC directly rather than letting it slide.
