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HMRC Letter Decoder

Got a letter from HMRC and not sure what it actually means? Search by code (P800, P2, SA250…) or topic and get a plain-English explanation, the deadline that matters, and the exact next step.

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Reality check: HMRC sometimes sends letters that look like demands but are routine notifications. The only authoritative source for whether you owe tax is your HMRC personal tax account at gov.uk/personal-tax-account. Never act on a letter you can’t reconcile with the account.

Spotting fake "HMRC" letters and texts

HMRC scams are extremely common. A real HMRC letter:

Report suspicious HMRC contact: forward emails to phishing@hmrc.gov.uk; forward texts to 60599. Full guidance: gov.uk — report HMRC scams.

Frequently asked questions

The questions readers most commonly ask about this topic. Each answer is reviewed by the UK Tax Drag editorial team against current HMRC, FCA and MoneyHelper guidance.

What is a P800 letter from HMRC?

A P800 is HMRC's tax calculation summary issued after the end of a tax year (typically June-October for the previous year). It tells you whether you paid the right amount of tax via PAYE. It will say either: you're owed a refund, you owe HMRC money, or it's balanced. P800s only apply to PAYE income, not Self Assessment. The refund route is usually to claim online via gov.uk.

What is a "Simple Assessment" letter?

Simple Assessment is HMRC's alternative to Self Assessment for taxpayers with uncomplicated income — typically pensioners with state pension over the Personal Allowance, or people with one-off taxable events. HMRC calculates the tax owed and sends a bill (PA302 form) which must be paid by 31 January following the tax year. There's no return to file, but you can dispute the calculation within 60 days.

What does it mean if HMRC writes about a "Determination"?

A Determination (typically letter SA315 or SA316) means HMRC has assessed your tax due based on what they know, because you haven't filed a return. The amount is usually high (HMRC errs on the side of charging more, knowing this forces engagement). To replace a Determination you must file the actual return within 3 years (or 12 months from the Determination date, whichever is later). After that, the Determination becomes final and unappealable.

What if I get a compliance check notice from HMRC?

A compliance check (formerly "enquiry") is HMRC formally investigating one or more aspects of your tax. Standard processes apply: you have 30 days to respond to information requests, you have rights to appeal individual decisions, you can use an agent to handle communications. Don't ignore the letter — penalties for non-cooperation are significant. Free help: Tax Aid (low-income) or HMRC's own complaints process if you feel the check is unfair.

What is a "Nudge Letter" and should I worry?

Nudge letters are HMRC's precursor to a full investigation — they're sent when third-party data (crypto exchange records, foreign bank info under CRS, gig economy platforms under DAC7) suggests you may have undeclared income. The letter typically says "we have information suggesting..." and gives 30 days to make a voluntary disclosure. Acting voluntarily reduces penalties substantially compared to waiting for HMRC to enquire formally.

What does a PAYE coding notice (P2) mean?

A P2 explains how HMRC has calculated your tax code. It shows your Personal Allowance, then any deductions (untaxed income, taxable benefits, prior-year underpayment, etc.) that reduce it. The final number divided by 10, followed by a letter, becomes your tax code (e.g. £12,570 ÷ 10 = 1257L for the standard allowance). Always check the breakdown — errors are common, especially on benefits-in-kind for company car drivers.

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