HMRC is sending letters to state pensioners that should not be ignored. Three specific letters from HMRC are IDMS99, IDMS99P, and potential tax avoidance notices. The IDMS99 letter indicates outstanding amounts due, while the IDMS99P letter is a simple assessment, which is an extra tax bill. According to Yorkshire Live, Colletta Smith described the IDMS99 as effectively a payment that is due, and the IDMS99P as basically an extra tax bill. It remains unknown how many state pensioners have actually received these letters.
More pensioners may face these letters because their income has risen into a tax bracket while tax thresholds have not changed. According to Yorkshire Live, Colletta Smith described that more people are potentially going to be facing these who are pensioners because they may well fall into a tax bracket for the first time this year or next year due to income rises without corresponding adjustments in tax brackets. This situation could lead to unexpected tax bills for retirees who have not encountered them in previous years.
The government are sending out letters at the moment, so something from the DWP and also HMRC you really shouldn't ignore. So at this time of year, especially if you've completed a tax return at the end of January, this is the moment you might get a letter saying, actually you owe a bit more than you thought you did. So HMRC have put out that information there.
A study by the Institute for Fiscal Studies found that 16% of people with a state pension age between 66 and 67 underestimate or are unaware of their correct age. Only two in three individuals in their early-to-mid-60s correctly identify their retirement age as 66, according to IFS senior research economist Heidi Karjalainen. Heidi Karjalainen stated that this gap in awareness is concerning because it can lead to financial risks, and for most, the state pension will represent a large part of their retirement resources.
The Institute for Fiscal Studies has called on the DWP to send a vital letter to every person in the UK born before 1976. The IFS recommends the government write to individuals around their 50th birthday about their state pension age and guarantee no changes within 10 years of reaching it. Heidi Karjalainen emphasized that clear and timely communication of any future increases in the SPA is important, adding that this would help give people confidence about when they can expect to receive a state pension and facilitate financial planning in the run-up to retirement. It is unclear what specific actions the DWP has taken in response to this recommendation.
There's that number at the top is the first letter they're saying don't ignore because that's effectively a payment that's due, you still owe a little bit more money. That middle number there, that long number, is a letter what they call a simple assessment. That's basically an extra tax bill.
The state pension age is being raised from 66 to 67 between April 2026 and April 2027. According to Yorkshire Live, Colletta Smith also noted ongoing problems at Royal Mail, where many letters either are not arriving or are arriving late, advising recipients to check the date letters were sent to see if they have already been dealt with. The extent of these delays and the specific consequences for pensioners who ignore HMRC tax avoidance notices are not detailed in available reports.
And more people are potentially going to be facing these who are pensioners because you may well fall into a tax bracket for the first time this year or next year because your income's risen, but the tax brackets haven't. So you might have to pay a bit more tax, you might end up with one of those bills that you haven't done in previous years.
And then that last letter there is about tax avoidance. So if anything arrives along those lines, it's super important to open it and try and face reality and deal with it. Even just to be aware of what's going on, even if you can't afford to pay it, make sure you're opening it and at least beginning the thought process.
We've been doing a big story.. about the ongoing problems at the Royal Mail at the moment. So a lot of letters either aren't arriving or are arriving late. So the first thing to do if you're getting, particularly, a wad of letters arrive through the door on one day is to check the date that that letter was sent. So it may already be out of date. You may have either missed the appointment, you may have already paid the bill, you may have already dealt with the situation because actually the letter was sent weeks ago and they've already sent you an email or a text message or something else to catch up with. So check the date that the letter was sent to see if it's something you've already dealt with that you can ignore.