HMRC Nudge Letters Explained (2026): Why You Got One and How to Respond

HMRC Nudge Letters in 2026 at a Glance

• Not a compliance check. No statutory powers behind it, no automatic penalty for not replying.
• Chosen by AI and analytics. HMRC’s own 2026 roadmap says a data mismatch leads to “a nudge letter or formal compliance check”.
• Usually asks for a reply within 30 days. Some campaigns give 60.
• Don’t sign the certificate of tax position. Reply by letter.
• Ignore it and any later disclosure is prompted, penalties rise, and a formal check is far more likely.

Table Of Contents

• What Is an HMRC Nudge Letter?
• Why Did I Get One? How HMRC Picks Recipients
• Is My HMRC Letter Written by AI?
• HMRC Nudge Letter Campaigns in 2026
• Nudge Letter vs Compliance Check vs Investigation
• Should You Sign the Certificate of Tax Position?
• How to Respond to an HMRC Nudge Letter in 5 Steps
• What Happens If You Ignore a Nudge Letter
• Nudge Letters Are Going Digital
• How to Check an HMRC Letter Is Genuine
• Get Help With an HMRC Nudge Letter

What Is an HMRC Nudge Letter?

A nudge letter is HMRC writing to many people at once about one issue. Its analytics has found a gap between what a group of taxpayers reported and what third parties (banks, platforms, exchanges, deposit schemes, overseas tax authorities) reported about them. Rather than open hundreds of enquiries, HMRC sends the same letter to everyone in the group and asks them to check their own position. The name comes from behavioural economics: the letter is designed to nudge you into correcting the return yourself.

Three things make a nudge letter different from a formal check:

• It isn’t opened under HMRC’s enquiry powers. There is no Section 9A notice and no Schedule 36 information request. The 30-day deadline is a request, not a statutory limit.
• It’s generic. The same wording goes to everyone in the campaign. The letter will name the issue (crypto, let property, dividends) but rarely the exact figures HMRC holds.
• It’s a warning shot. HMRC’s own guidance describes the letters as giving people the chance to put things right before formal action. The implied next step if you don’t is a compliance check.

The letter will usually offer three options: confirm your return is correct, amend it, or make a disclosure through the facility it names. Some campaigns also enclose a certificate of tax position for you to sign. More on why you shouldn’t below.

Why Did I Get One? How HMRC Picks Recipients

You received a nudge letter because HMRC's Connect system matched third-party data against your return and found a gap. Connect draws on more than 50 data sources. Each campaign starts with a data set (tenancy deposit records, exchange customer lists, dividend vouchers filed by companies, CRS reports from overseas banks) and a filter: everyone in that data set whose Self Assessment return doesn't show the matching income. That list becomes the mailing list.

This is the part of the process HMRC is open about. Its Transformation Roadmap update, published 2 July 2026, says AI and analytics “highlight tax returns that may contain inaccuracies”, that compliance officers still make the decisions, and that where a mismatch is found the outcome is “a nudge letter or formal compliance check”. The same document reports that AI and analytics protected or recovered £10 billion of tax in 2025-26.

The volume has grown quickly:

• 81,000 crypto nudge letters went out in 2025/26, up from 65,000 the year before and 27,714 in 2023/24, according to HMRC figures obtained by UHY Hacker Young.
• The campaign tracker maintained by rossmartin.co.uk lists six new campaigns in July and August 2026 alone.
• HMRC appointed its first Chief AI Officer in April 2026 and is recruiting 5,500 additional compliance officers by 2029-30, with more than 2,100 already in post.

For a full explanation of how the scoring works, see HMRC Connect explained. For the wider picture on what triggers HMRC’s interest, see how likely you are to be investigated by HMRC.

Is My HMRC Letter Written by AI?

Possibly, but HMRC says a human signs off every one. AI decides who gets a letter; whether AI writes the letter is contested. HMRC's official position, given in September 2025 after a tribunal ordered it to answer, is that generative AI "was not approved for use in generating taxpayer letters" and that enquiries are "opened, managed and decided by a human". Since then HMRC has issued 28,000 Microsoft Copilot licences to staff for drafting and summarising, with 50,000 planned during 2026.

The question only reached a tribunal because of what advisers were seeing on the page. In 2023, R&D tax relief specialist Tom Elsbury noticed that HMRC rejection letters had started to contain American spellings, unusual formatting and generic reasoning that didn’t match the claim in front of him. He submitted a Freedom of Information request asking whether HMRC was using large language models. HMRC refused, citing prejudice to tax collection, and the Information Commissioner backed the refusal.

In Elsbury v Information Commissioner [2025] UKFTT 915 (GRC), the First-tier Tribunal overturned both decisions and ordered HMRC to answer by 18 September 2025. Judge Alexandra Marks found the arguments for disclosure “compelling”, noting that secrecy around AI in decision-making undermines trust. HMRC’s answer was that its R&D compliance team did not use generative AI as part of its work on R&D claims, and that the technology was not approved for generating taxpayer letters. Reports at the time said a number of staff in HMRC’s small business compliance directorate had been disciplined for unauthorised use of AI in correspondence. Elsbury described the response as “smoke and mirrors”.

What this means for you, in practice:

• A generic letter is not a weak letter. The wording may be boilerplate. The data behind it is specific to you.
• Don’t assume HMRC has proof. A nudge letter says HMRC holds information, not that it has established a liability. Sometimes the data is gross rather than net, or relates to the other holder of a joint account.
• Read it as a human would. If the letter contains figures, dates or reasoning that make no sense for your situation, say so in your reply. Officers do review responses.

HMRC Nudge Letter Campaigns in 2026

HMRC runs roughly one new one-to-many campaign a month. Below are the campaigns we know of from HMRC's own published letter list, professional-body announcements and adviser trackers, as at 15 September 2026. If you've received a letter that isn't listed, it may be new, or it may not be genuine (see how to check).

When	Who got the letter	What HMRC wants	Disclosure route
14 to 28 September 2026	Self Assessment filers who claimed retirement annuity relief	Check the 2024/25 claim	Amend the return
July to August 2026	People with undeclared online sales, social media or card-payment income	Tells them they’ve been registered for Self Assessment	File the return
August 2026	Executors of estates valued close to nil-rate-band thresholds (£325k, £500k, £650k, £1m)	Re-check the estate valuation	Amend the IHT account
August 2026	Trusts and estates that gave notice of intent to disclose but didn’t complete within 90 days	Finish the disclosure	Existing disclosure
July 2026	Landlords whose returns don’t match tenancy deposit scheme data	Check and correct rental income	Let Property Campaign
July 2026	Cryptoasset holders	Review Income Tax and CGT on disposals	Crypto disclosure service
July 2026	Taxpayers with provisional Business Asset Rollover Relief claims from 2022/23	Submit the final claim	Amend the return
July 2026	Businesses running prize draws	Account for output VAT on entry fees	VAT error correction
7 April to 30 September 2026	Companies that may not have declared associated companies when claiming Marginal Relief	Check Company Tax Returns from April 2023	Amend the CT600
April 2026	People affected by the end of the non-dom regime	Review obligations under the new rules	Self Assessment
April 2026	Businesses engaging “behind camera” workers	Check employment status	PAYE correction
March 2026	Filers who used provisional or round-sum figures for 2024/25	Replace estimates with actuals	Amend the return
January to May 2026	Business Asset Disposal Relief claimants	Confirm the £1m lifetime limit wasn’t breached	Amend the return
Early 2026	Taxpayers whose 2024/25 return looked wrong	Check and amend within 30 days (by 25 April 2026)	Amend the return
Late 2025	Undeclared dividend income (2023/24); High Income Child Benefit Charge for PAYE earners over £60k; wealthy non-filers over £200k	Review and amend	Self Assessment

Two earlier campaigns still generate follow-up letters and are worth knowing about: online marketplace sales (eBay, Vinted, Etsy, Airbnb data from January 2025 onwards) and Persons with Significant Control (anyone listed as a PSC at Companies House who didn’t file a return).

The crypto campaign deserves a note of its own. HMRC currently relies on data requests to UK exchanges. From 31 May 2027 it will receive exchange data automatically under the OECD’s Crypto-Asset Reporting Framework. As one adviser put it to Accountancy Age, once that data lands, investigations into crypto investors “will be like shooting fish in a barrel”. The 2026 letters are the last cheap chance to disclose.

Nudge Letter vs Compliance Check vs Investigation

The three are different stages, not different names for the same thing. A nudge letter is informal and generic. A compliance check is formal, specific and backed by statutory powers. An investigation is a compliance check that has grown. Most people who respond properly to a nudge letter never reach stage two.

	Nudge letter	Compliance check	Full investigation / COP9
Legal basis	None; a request	Section 9A TMA 1970 (SA), Schedule 36 FA 2008	Same powers, wider scope; COP9 under the Contractual Disclosure Facility
Who receives it	Everyone in a data-matched group	A named taxpayer	A named taxpayer suspected of significant error or deliberate behaviour
Wording	Standard for the campaign	Specific to your return	Specific, often across several years and taxes
Deadline	Usually 30 days, requested	30 days for information notices, backed by penalties	Set per stage; 60 days to accept a COP9 offer
Disclosure status	Prompted for the issue named	Prompted	Prompted
Typical length	Closed on reply	3 to 16 months	12 months or more

If your letter names an officer, quotes Section 9A or Schedule 36, and asks for specific documents, it is a compliance check, not a nudge letter. Our HMRC compliance check guide covers that process step by step.

Should You Sign the Certificate of Tax Position?

No, in almost every case. The certificate asks you to declare that your tax affairs are complete and correct, or that you will make a disclosure. It is not a statutory document, there is no legal obligation to sign it, and it has no time limit: it covers every year, not just the one HMRC wrote about. If HMRC later finds an error, a signed certificate makes it far easier to argue your behaviour was careless or deliberate, which lengthens the look-back period to 6 or 20 years and pushes the penalty up. The Chartered Institute of Taxation's guidance is to reply by letter instead, and HMRC has confirmed to the CIOT that it will accept a letter.

A reply by letter can say exactly what the certificate says, but on your terms: which years you’ve reviewed, what you checked, and what you concluded. It can also say “I have reviewed the 2023/24 return and it is correct” without making a sworn statement about 2009/10. That precision is the whole point.

If you do want to confirm your position is correct, a short letter is enough. If you’ve found an error, the letter should say that a disclosure will follow and by when.

How to Respond to an HMRC Nudge Letter in 5 Steps

Respond within the deadline, reply by letter rather than certificate, and disclose anything you find before HMRC finds it. Done properly, most nudge letters close with a single exchange of correspondence.

1. Check the letter is genuine. Compare it with HMRC’s list of current letters. Genuine letters quote your UTR or National Insurance number and give a GOV.UK page or an 03000 number. Any email should come from an address ending hmrc.gov.uk, and HMRC never asks for bank details by email or text.

2. Work out what data HMRC has matched. The letter names the issue. Identify the third-party data behind it: exchange records for crypto, tenancy deposit scheme data for let property, dividend vouchers filed by the company, CRS reports for overseas accounts. Pull your own records for the same years before you form a view.

3. Decide whether your return is actually wrong. Sometimes it isn’t. HMRC’s data can be gross rather than net, can double-count transfers between your own accounts, or can belong to the other holder of a joint account. If the return is right, say so in writing with a short explanation of why.

4. Reply by letter, not by certificate. Confirm either that your affairs are correct for the years you’ve checked, or that a disclosure will follow. Keep a copy and send it recorded delivery, or upload it through your HMRC account if the letter arrived digitally.

5. If there is an error, disclose before the deadline. Use the Digital Disclosure Service, or the specific facility the letter points to: the Let Property Campaign for rental income, the crypto disclosure service, the Worldwide Disclosure Facility for offshore matters. Responding within the 30 days keeps the penalty at the low end of the prompted band, and anything unrelated you find and volunteer at the same time is treated as unprompted.

If you need more time to gather records, write and say so before the date passes. HMRC will normally allow it. Going silent is the one response that never helps.

A client unknowingly failed to declare rental income from a second property. HMRC discovered it through a combination of land registry and council tax data. They knew he wasn't living there and assumed — rightly — that it was being rented out.

He received a letter inviting him to disclose the income voluntarily. We went back through five years of records, calculated the unpaid tax, interest, and penalties, and submitted a full disclosure. HMRC accepted our offer, and the case was closed.

This case shows that HMRC has access to cross-government data, and rental income is a common red flag.

What Happens If You Ignore a Nudge Letter

Nothing automatic, and that's the trap. There is no penalty for not replying, because the letter isn't a statutory notice. But HMRC records who it wrote to. If it later finds the error, any disclosure is prompted, HMRC can argue the behaviour was careless or deliberate because you were warned, and a formal compliance check covering more years becomes far more likely.

The penalty maths is what makes ignoring a nudge letter expensive. For a careless error, the penalty range is 0% to 30% of the tax if you disclose unprompted, and 15% to 30% if prompted. For deliberate behaviour it is 20% to 70% unprompted and 35% to 70% prompted. A nudge letter already moves you into the prompted column for the issue it names. Ignoring it, and then being found, is what moves you from careless towards deliberate.

There is a time-limit consequence as well. A careless error lets HMRC go back 6 years. Deliberate behaviour lets it go back 20. See how far back HMRC can go for how each limit works.

Late payment interest currently runs at 7.75%, unchanged since 9 January 2026, from the date the tax was originally due. On a five-year-old liability that is a meaningful addition before any penalty is applied.

Nudge Letters Are Going Digital

Since April 2026, HMRC has been moving to digital by default. If you use the HMRC app or a Personal Tax Account, letters increasingly land in your online account rather than the post, and you receive an email telling you a new message is waiting. Paper continues for people who haven't gone digital or have opted out. HMRC's stated aim is to cut postal output by around 75% and save £50 million a year by 2028-29.

This matters for nudge letters specifically. A letter you never see is a letter you can’t respond to, and HMRC’s record will still show it was sent. Three habits help:

• Check your HMRC account when you get an email about a new message. Log in through the app or GOV.UK directly, never through a link in the email.
• Keep your email address current in your Personal Tax Account. The notification goes to whatever address HMRC holds.
• If your accountant is authorised, make sure their details are current too. Agent copies of one-to-many letters are common.

If you’d rather keep receiving paper, you can. Simply don’t confirm electronic contact details when prompted. HMRC has said paper “will continue to be available for customers who choose not to engage with us digitally”.

How to Check an HMRC Letter Is Genuine

Scam letters and emails imitating HMRC rise every time a genuine campaign is publicised. Compare any letter with HMRC's own list of current letters on GOV.UK, which is updated as each campaign begins and gives the dates HMRC is sending them.

Signs a letter is genuine:

• It quotes your Unique Taxpayer Reference or National Insurance number correctly.
• It gives a GOV.UK page or an HMRC phone number starting 0300 or 03000 to call. Check the number against GOV.UK, not the letter.
• Any email notification comes from an address ending hmrc.gov.uk and tells you to log in, rather than linking you to a form.
• It does not ask for bank details, card numbers or passwords, and does not threaten arrest or immediate court action.

Signs it isn’t:

• Spelling or grammar that is clearly wrong. Note the irony given the Elsbury case, but scam letters are usually much worse than an HMRC letter with an American spelling.
• A demand for payment by bank transfer to a personal account, gift cards or cryptocurrency.
• Pressure to act within hours.

If in doubt, call HMRC on a number from GOV.UK, or send the letter to your accountant before you reply to it.

Get Help With an HMRC Nudge Letter

Most nudge letters can be closed with one careful reply. The mistakes we see are the same every time: signing the certificate, ignoring the letter, or disclosing in a rush without checking whether the return was actually wrong.

ARB Accountants handles nudge letters, disclosures and HMRC compliance checks for individuals, landlords, crypto investors and small businesses. We read the letter, work out what data HMRC holds, tell you whether your return needs correcting, and write the response or run the disclosure on your behalf.

Read next

• How likely are you to be investigated by HMRC? (2026 guide): triggers, stages and what to do
• HMRC Connect explained: the data system that decides who gets a letter
• HMRC compliance check: steps to pass without issues: if your letter is the formal kind
• How far back can HMRC go?: the 4, 6, 12 and 20 year rules
• How to make a voluntary disclosure to HMRC: if the letter is right and you need to put it straight