EM6407 - Contract Settlements: Acceptance: SAFE - Handling General Payments on Account
The guidance about contract settlements at EM6000+ only relates to direct tax. You must never include VAT or VAT penalties in a contract settlement.
General payments on account are normally received in advance of a settlement charge being raised. Before the payments can be entered on SAFE, a customer account with a unique 15 character SAFE Customer reference must be created by the SAFE nominee. In all cases where payments on account have been requested you should ask the SAFE nominee to set up a SAFE Customer reference. You should tell the person to use this reference number and advise you when they have made a payment, so it is processed correctly.
General payments on account are held on the customer’s account and remain there unallocated until a charge is raised. The SAFE nominee can view them by selecting “View Customer Account”. SAFE is designed to expect payment of a charge in 30 days so payments on account are only allocated to a charge 30 days before the due date.
Where a charge is raised on receipt of a payment on account and the payment is sent to the Accounts Office quoting the charge reference, the payment on account will be allocated to that specific charge.
Where payments on account are made in advance of the charge and are unallocated, SAFE will automatically allocate them to the next charge becoming due. This means that in some circumstances SAFE may incorrectly allocate them against other charges.
Locking Payments
To prevent payments being incorrectly allocated, all payments on account held in SAFE must be locked.
As soon as you are aware that a payment has been made, either directly to you or DMB, you must
- complete the stencil SAFE 3 (POA) Locking Stencil, which is available in SEES and
- e-mail the completed stencil (This text has been withheld because of exemptions in the Freedom of Information Act 2000) (This text has been withheld because of exemptions in the Freedom of Information Act 2000) using “SAFE” as the title of the e-mail.
Compliance Identifier
When completing SAFE stencils you must include your Compliance Identifier in the caseworker’s details section of the stencil. Where to find this or what to include will depend on your business unit. If you work in
- Local Compliance, see the guidance that is currently in LC Memo 08/11
- SI, you should include the following in this format - SI/Region/Location/PID
- CAR PT International guidance, you should include the following in this format - CAR/PTI/EC/Caseflow ref/PID.
Unlocking Payments
When you are ready to settle a case you should ask the SAFE nominee to check what payments are held on SAFE. You should then follow the guidance at EM6403. The SAFE nominee will have to phone the SAFE team (This text has been withheld because of exemptions in the Freedom of Information Act 2000) before 2pm to unlock the payments on the same day the charge is raised.
If excessive payments on account have been made either complete a SAFE 1 repayment stencil or, if they need to be re-allocated, e-mail (This text has been withheld because of exemptions in the Freedom of Information Act 2000)the details including the head of duty reference. Use “reallocation” as the title of the e-mail.(This text has been withheld because of exemptions in the Freedom of Information Act 2000)
