COM122090 - Repayments / reallocations: non automatic reallocations: reallocations in a banking operations office

This subject is presented as follows

General

You only need to deal with reallocations when the computer cannot deal with them automatically and enters the cases on Function LOPU (Overpayment Review List) or Function LSUP (Payments In Suspense List). For more information about these work lists see

• Section 'Repayment / Reallocation Work Lists' (COM126000) in this business area
• Business area 'Work Lists'

The functions for making reallocations are

• REAW (Direct Reallocation Within COTAX) to reallocate money

• • From one duty to another within a specified AP
  • To one or more APs for the same company reference
  • To a specified reference and AP

• • Note: The ‘Reallocate a specific payment’ option lets you make a reallocation without attracting repayment interest (RPI)
    

• REAO (Direct Reallocation Out Of COTAX) to reallocate an overpayment to OAS (Word 28KB) 

• • The computer will not add RPI when you reallocate to OAS using this function

• REAI (Direct Reallocation into COTAX) to reallocate an amount from OAS to the COTAX record

You are responsible for making reallocations of

• Certain overpayments
• Payments held in suspense
• Incorrectly allocated payments
• Returned cheque payments and lodgement adjustment cases - For more information see section 'Payments Returned by the Bank ' in business area ‘Payments’

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Overpayments referred to Banking Operations Office

When an overpayment is not dealt with automatically the computer refers cases to the Banking Operations office on work list LOPU (Overpayments Review List).

An overpayment is referred to the Banking Operations office in the following circumstances

• The PRFI (Word 28KB) signal is set
• Any of the following conditions exists on the overpaid AP

• • The case is RFI (Word 31KB) at the Banking Operations office
  • A manual remission is present other than manual remissions in Insolvency and LA Enforcement Proceedings cases that are referred to the Debt Management Office
  • The Clerical Interest Indicator (CII (Word 32KB)) is set other than in Insolvency and LA Enforcement Proceedings cases that are referred to the Debt Management Office

• Any of the following conditions exists on the potentially receiving AP

• • The case is RFI at the Banking Operations office
  • A manual remission (but not class 10 Interest only) is present other than remission in Insolvency cases that are referred to the Debt Management Office
  • The CII is set other than in Insolvency cases that are referred to the Debt Management Office
  • The normal due date has passed but no tax charge is recorded
  • The case is LA Enforcement Proceedings

Before you reallocate a tax overpayment (Word 35KB) always check that the overpayment has not been caused by the incorrect allocation of a payment.

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Reallocations within COTAX Function REAW

When you use Function REAW to make a reallocation within COTAX you can

• Elect to have an overpayment reallocated automatically by the computer to one or more APs for the same COTAX reference
• Opt to have an amount reallocated automatically by the computer within a specified AP and COTAX reference
• Specify how a payment in error or a ‘block payment’ reallocation is to be allocated to an AP and COTAX reference

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Intra group surrenders under S102 FA 1989

When companies within a group elect for an overpayment to be reallocated from one company to another they will submit a claim to the responsible CT office. The responsible CT office will consider the interest consequences of any reallocation when dealing with the case. You must not reallocate money from one company to another unless you have confirmed that the payment was allocated incorrectly.

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Incorrect credit for repayment interest (RPI) when the responsible CT office has reallocated money using Function REWD

If you identify a payment that has been credited to the wrong AP yourself, or have one drawn to your attention by the Inspector, reallocate the money to the correct AP usingthe option ‘Reallocate a specific payment’ in Function REAW. This option moves the money without adding RPI.

(This text has been withheld because of exemptions in the Freedom of Information Act 2000) 

If you discover a case where spurious RPI has been credited and repaid, refer the matter to your CT liaison team or line manager immediately.

For a list of forms relevant to this subject, see COM122091.

For a list of functions to use in particular situations, see COM122092.

For legislation applying to this subject, see COM122093.