The way HMRC handles tax on bank and building society interests is changing and they have begun informing taxpayers it will affect.
What has HMRC introduced?
Since October 2025, HMRC has introduced Simple Assessment letters and have begun sending those out to individuals.
These would be individuals who owe tax on any interest they have accumulated from banks and building societies between April 2024 and April 2025.
The letters outline how much they owe on the interest generated during the 2024/25 tax year. As well as confirming the outstanding fee owed, the letter will explain why you are being charged that specific amount and how you need to pay the bill.
There may be circumstances where you receive an additional Simple Assessment letter, but this will only happen if your bank or building society has provided HMRC with updated information that includes accumulated interest.
If you have paid an amount following an initial first letter, and if there is a new figure stated on a second letter, you need to calculate the remaining balance and pay HMRC.
While you might not have declared any incurred interest, your bank or building society reports the interest you receive each year to HMRC. From there, HMRC can begin actioning steps, which begin with sending the Simple Assessment letter.
Should I be concerned if my figures don’t match?
There is no need to be concerned if the figures from your tax code and bank statements do not match.
This will be taken into consideration because there are several factors that can impact this including only taxable interest included within your tax codes and when you are organising assessments.
In addition to this, some of the interest incurred in your personal savings allowance can be tax-free. The figures may also not align because HMRC will be estimating the figures based on the data they have access to. A more accurate figure can be given once HMRC have the information it needs.
If you feel HMRC were incorrect in sending you a letter in regard to bank and building society interest, you can dispute this. However, you will need to dispute this directly with HMRC and do so within 60 days of receiving the letter.
If the Simple Assessment letter seems confusing in any way or you are not sure why you have received the letter, we can advise and support you. We check your figures and give you the tools to fulfil your obligations.
Get in touch with our expert team of accountants for valuable advice and support.
