COM125001 - Repayments / reallocations: non automatic repayments: introduction

This subject is presented as follows

Background
Who makes the repayment
Function DIRR
Overpayment work lists 

Background

COTAX does not make automatic repayments when

• One or more signals are set which inhibit automatic repayment processing
• One or more conditions that prevent COTAX from making an automatic repayment are present on the record. See subject 'Overpayments that cannot be handled automatically' (COM121010) in section ‘Inhibit Automatic Process’
• The amount overpaid is equal to or below the small repayments (Word 34kb) limit on the company record
• Amounts of income tax, payment of tax credits, CIS25, S458 CTA 2010 (formerly S419(4) ICTA 1988) relief and advanced corporation tax (ACT) under the foreign income dividends (FID) provisions are posted on the relevant AP record(s) using Function DSET (District Set-Off). You must use Function DIRR (Direct Repayment) to make the repayment (See subject 'Reallocation into COTAX - Responsible Office’ (COM122010)

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Who makes the repayment

The office that owns the company record normally makes the repayment. The exceptions are

• Payments made in error (including cases referred by the responsible and Debt Management offices). These are repaid by the Banking Operations office
• Repayment claims received in respect of Group Payment Periods (Word 27kb) that are Open or Closed. These are dealt with by the Group Payment Teams (Word 28kb) in the Banking Operations offices at Shipley or Cumbernauld. (Note: A ‘Closed’ Group Payment Period is one where a tax charge is held on each participating company’s linked AP and the Group Payment Team are awaiting or dealing with the allocation of the payments held on the Group Payment Record)
• Repayment is being made from a CTSA AP that is under enquiry. In these circumstances, the amount to be repaid is reallocated into the OAS (Word 28kb) account and repayment is made by the Banking Operations office. See 'Early Repayment CTSA APs - Responsible Office (AG)' (COM125064)
• Claims for tax credits before the normal due date (Word 49kb) (NDD) where a charge also exists. District Set Off (DSET) postings (specific amounts) should be reallocated to the OAS account and you should use form CT251 to request Banking Operations office to make the repayment

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Function DIRR

All other repayments of CT for APs ending on or after 1 October 1993 should

• Always be made using Function DIRR (Direct Repayment), except on specific instructions from Head Office. (Telephone the COTAX Business Help Desk (This text has been withheld because of exemptions in the Freedom of Information Act 2000)to request authority to make a manual repayment.) However, see subject 'Manual Repayment: Outside COTAX - Responsible Office' (COM125020) and section 'Repayment / Reallocation Authorisation' (COM124000) for information about large repayments
• Wherever possible, be made to the recipient's bank or building society account, using BACS (Bankers' Automated Clearing Service). Repayment by BACS is faster, more secure and cheaper than issuing payable orders. Where no BACS details are available, you should contact the company to explain the benefits of BACS and get these details. CHAPS (Clearing House Automated Payment System) should only be used in exceptional circumstances and you must request authority from Head Office to make a CHAPS repayment. 

If, exceptionally, a company cannot receive a repayment by BACS or payable order because it does not have a bank account, telephone the COTAX Business HelpDesk (This text has been withheld because of exemptions in the Freedom of Information Act 2000) for assistance.

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Overpayment work lists

Overpayments (including repayments that COTAX cannot handle automatically) are entered on one of the following Work Lists

• ORUR (Overpayments Requiring Urgent Review)
• LOPD (Overpayments List)
• LOPU (Overpayments Review List)

Cases displayed on ORUR are normally repaid automatically 14 days after the entry date unless

• Another ORUR condition arises during the 14 day period. ORUR is then updated with the new reason for entry and the 14 day period restarts from the new entry date
• The reason for entry on ORUR is ‘Repayment stopped using Function SREP (Stop Repayment)’. These cases remain on ORUR unless a condition already exists or arises which is applicable to LOPD or LOPU
• LOPD or LOPU conditions exist. These cases are transferred to either LOPD or LOPU from ORUR when the 14 day period expires

When a case appears on LOPD or LOPU you must review the reason for entry and deal with the overpayment.

For more information about these work lists see business area 'Work Lists' or section 'Repayment / Reallocation Work Lists' (COM126000) in this business area.