COM20140 - Assessing: CT pay and file assessments: making assessments and penalties on same day

When you make or amend an assessment for a CT Pay and File AP, it may affect the penalty position for the specified period (Word 27KB) into which the AP falls. Depending on the penalty position, you are presented with a choice of actions at the end of function

• PASR (Prepare Assessment Based on Return)
• PAST (Prepare Full Assessment)

• PEST (Prepare Estimated Assessment)

In transitional periods (Word 37KB) you are presented with the options of

• Proceeding to Function PPEN to issue or revise the penalty determination

• Setting the ‘No Penalty Required’ indicator

In non-transitional periods (Word 37KB) you are presented with the options of

• Allowing the automatic issue of penalties

• Proceeding to Function PPEN (Prepare Penalty Determination) to issue or revise the penalty determination

• Setting the ‘No Penalty Required’ indicator

Notes: 

It is important to note that if you make an assessment first and then select the automatic issue of penalties option or use Function PPEN to issue a penalty determination, any overpayment on the assessment will

• Be repaid automatically

• Not be allocated against any unpaid liability on the penalty determination

This happens even when the penalty determination is made on the same day as the assessment and the company will receive a repayment and an application for payment within a day or two of each other.

You must stop this happening by

• Using Function MRSC (Maintain Rept / Realloc Signals (Co)) to inhibit automatic reallocations and repayments at company level

This will make sure that COTAX

• Reallocates the tax overpayment against the penalty charge

• Issues a payment application for the net penalty due

• Repays any remaining overpaid balance

You must remember to unset the signal after COTAX has dealt with the reallocation so that automatic reallocations and repayments can continue.

Note: If you find that you have

• Issued an assessment that has caused an overpayment

• Selected automatic issue of a penalty or used PPEN to issue a penalty

• You have forgotten to inhibit repayments and reallocations

• • On the same day you can use Function SREP (Stop Repayments)

For more information about penalties see the ‘Penalties’ business area.

For a list of functions to use in particular situations, see COM20011.