PAYE055 - Glossary of terms

A

Abroad

An address is not abroad if it is

 Within the United Kingdom, Isle of Man or Channel Islands

 One of HM Ships

 With British Forces Abroad or an address with a British Forces Post Office (BFPO) number.

Accounts Office

There are three sites where the work of Banking Operations is carried out

 Cumbernauld

 Shipley, and

 Newcastle.

Banking Operations is responsible for

 Day to day payment processing and accounting work from employers, contractors and SA taxpayers

 Issuing assessments, demand notes and reminders

 Updating and maintaining taxpayer records.

Accounts Office reference

This is the reference used to identify each BROCS record.  It includes

 Your office number, consisting of three numeric characters (numbers) using where necessary leading zeros

 The letter P

 A check character

 A register number which will be

 Outside Scotland from one to six figures

 In Scotland seven figures followed by the letter X.

Additional complete return

Additional Complete shows that the return is

 Supplementary to the original EOY return that was captured for that year

And

 A complete return

Additional EOY return

An additional End of Year (EOY) return is

 Supplementary to an original EOY return that has been received for that year

And

 Can be of the same return type. For example a P35

The amounts included on an additional return must not include the amounts shown on the original return received.

An Additional return arises for example

 If details from a P14 were omitted from the original return

 In the case of a PSC scheme if either return is captured after the other then the later return is deemed to be an ‘Additional Return’

Additional part P35 return

Additional Part P35 shows that the return is

 Supplementary to the original EOY return that was captured for that year

And

 A P35 on its own without any forms P14

Additional pay

Additional pay is an amount added to an employee's 'total pay to date' on any pay day when a K code is used. It is used to collect extra tax due from employees who have untaxed income (such as state benefit) which cannot be fully covered by allowances.

Address framework

The Address Framework provides a means of standardising the handling and storage of address information.

It holds a copy of the database used by the Post Office to hold details of all UK verified addresses known as the ‘Post Office Address File’ or ‘PAF’.

Function ADDRESS SEARCH is used to access the data on this Framework in order to search for and store addresses onto an employer record.

Agent

An agent is a person or group of persons appointed by an employer to act on their behalf.

Where an agent deals with and requires copies of all of the following correspondence then that agent’s details must be entered on the employer record

 Operation of PAYE

 Employer’s copies of coding notices

 Payslips

 >Employer Pack

 Employer annual returns

 Regulation 80 Determinations

 Late EOY return penalties and P11D penalties

 General employer correspondence and other employer assessments.

Notes:

1. If you receive a form 64-8 (Authorising Your Agent) you must send a copy of the form together with form 64-6A to the Central Agent Authorisation Team (CAAT) who will enter the details on to EBS and other systems

2. We must have a signed FBI 2 authorisation before we can send information to agents using PAYE online for Employers - Internet. We can however receive information, on behalf of the employer from any agent or representative

Agent (for employer)

An agent is a person or group of persons appointed by an employer to act on their behalf.

An agent’s responsibilities to the employer may differ but could include

 Receiving copies of determinations

 Dealing with and issuing or sending correspondence

 Running the payroll.

ASN

The ASN or Assessing Sub number identifies the year on the Banking Operations record to which the annual return or charge relates.

The ASN consists of

 The final two digits of the tax year

Followed by

 A sub-number, which will always be 01.

For example the ASNs for

 1998/99 will be 9901

 2000/01 will be 0101.

B

BACS

BACS is an automated service operated by banks and building societies for clearing payments. It avoids the need for handling cheques or cash when making payment.

BACS payments are transferred electronically into the HMRC account with the Bank of England. The bank notifies Banking Operations of payments on magnetic tape.

Bank Giro

Bank Giro is a credit transfer system that enables payment to be made through a bank branch. Each payment is credited to an HMRC Bank Giro account with the Bank of England. The target bank account is indicated on the payslip. Each account is associated with one of the Banking Operations sites.

The Bank of England notifies the AO of the credits received each day in each Bank Giro account. The credits are notified mainly on magnetic tape but a small proportion is notified on paper.

Banking Operations

From 1 November 05 Banking Operations was established within the Debt Management & Banking business.

Banking Operations - Direct Taxes work includes the work of the former Accounting & Payments Service

 Day to day payment processing and accounting work for employers, contractors and SA taxpayers

 Issuing assessments, demand notes and reminders

 Updating and maintaining taxpayer records.

Bankruptcy

Bankruptcy (known as Award of Sequestration in Scotland) is a legal process for dealing with individuals, sole traders and certain partnerships that are unable or unwilling to pay their debts. Bankruptcy orders are made by the Courts following the presentation of a petition.

The equivalent legal process for a company is liquidation.

Batch process

A batch process is an automatic process that runs in the background, either immediately or overnight, following action taken on the computer record. It cannot be accessed on-line by an operator.

Batch processes are used, for example, to update taxpayer records with data supplied by external systems, to extract information and to produce output.

Better Management of Electronic Information

Better Management of Electronic Information (BMoEI) have established a range of tools including help-cards, folder structures and naming conventions aimed at improving electronic storage of information, using the existing IT tools.

From June 2006 most of the information formally stored in employer establishment files will be moved to the electronic file structure.

BROCS

Business Review Of the Collection Service is the Banking Operations computer system.

Each employer or contractor required to make a return (with the exception of DC cases where the taxpayer does not account for his own NIC) has a record held on this system.

Banking Operations use these records to

 Make bulk issues of

 Returns to employers and contractors near the tax year end

 Reminders for returns and amounts outstanding

 Keep a record of payments

 Advise the Debt Management Office when to follow up outstanding returns

 Advise the Processing Office of some amounts overpaid

Business Support Team

BSTs were introduced as an initiative to meet the Government's commitment to reducing the burden on employers and businesses. Their primary aim was and still is to provide a free educational support service for new and small employers. It is important to ensure whilst speaking to employers in your day to day work that any employer can be referred to BSTs for help and assistance should this be deemed appropriate.

BSTs can offer

 One to one visits

 Payroll support service

 Payroll health checks

 Workshops

C

Cancelled one year only

A scheme is cancelled for one year only (COYO) when for that year

 No payments of earnings equivalent to or above the Lower Earnings Limit (LEL) were made to employees

 No payments have been made to BROCS relating to the year of the return

 No Tax Credits have been authorised or funding payments made to the employer

Central Agent Authorisation Team

The Central Agent Authorisation Team (CAAT), based at Longbenton, ensure that when a form 64-8 is received to appoint an agent to act on behalf of an employer or contractor the details are speedily recorded on to EBS and other systems.

Any form 64-8 received in a Processing Office should be promptly sent with form 64-6A, using Tax Post, to CAAT (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)(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)

(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)(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)

(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)

Central Exceptions Processing Team

The Central Exceptions Processing Team (CEPT) is located at NICO and processes return exceptions from ERIC.

CHAPS

CHAPS stands for Clearing House Automated Payment System.  It is a facility offered by Banks for arranging same day payment and is normally used for paying larger amounts.

Money is transferred electronically into the HMRC account with the Bank of England. The Bank notifies Banking Operations of each payment on the day of receipt.

Cheque for cash

The cheque for cash (CFC) facility was withdrawn from 1 January2006. All offices will inform visitors to pay at the Post Office or a Bank.

Collection account year

The Collection Account Year is the period from

 The last Friday in October to

 The Thursday before the last Friday in October of the following calendar year (both days inclusive)

Companies holding CIS5 certificates

A Construction Tax Certificate (CIS5) permits the contractor to make payments to the company named on the certificate without deduction of Income Tax.

Company registration number

The Registrar of Companies allocates a Company Registration Number to a company that is incorporated or registered under the UK Companies Acts.

The Company Registration Number (CRN) is unique to that company and will be in one of the following formats

 8 numeric characters in the range 0-9

 NI (where the company was registered in Northern Ireland) followed by 8 numeric characters in the range 0-9. For example, NI21345678

 SC (where the company was registered in Scotland) followed by 8 numeric characters in the range 0-9. For example, SC21345678

Notes:

1.  No prefix is used for companies registered in England and Wales

2. If the CRN has less than 8 numeric characters it must be prefixed with leading zeros. For example, 00345678

Company UTR

When a company record is set up the computer system allocates a 10 digit reference number. This is then the company reference throughout its life. It is known as the Unique Taxpayer Reference (UTR).

This same principle applies to allocating UTRs to individuals and partnerships.

Complete return

A complete return is one where the employer has submitted a P35 together with all expected forms P14.

If an employer intends to send the whole return by the paper channel, then the return must be submitted as a complete return and not in parts.

Consolidated position

This term refers to the overall net position of a monetary item having taken into account all previous End of Year returns captured for that employer record for a given year.

This figure is calculated by the computer and is situated to the left of the monetary field.

For all additional or correction returns each monetary item on the End of Year return will have two amounts on the CAPTURE EOY RETURN DETAILS ADDITIONAL / CORRECTION screen

 The Net Adjustment amount

And

 The consolidated position.

The following table shows an example of how the consolidated position is calculated for returns already captured

Return Figures

Original return showing total tax due of £100.00

£100.00

See note

Corrected return showing a figure of minus £10.00 tax

Note: When capturing an original or pro-forma return there is only one monetary amount shown for each monetary item. That amount would be classed as both the net adjustment and consolidated position

Contractor

The term contractor has a wide meaning and includes

 Any person carrying on a business whose trading activities include construction operations (mainstream contractors)

 Any local authority, development corporation or Commission for New Towns

 The Housing Corporation, Housing for Wales, a housing trust, Scottish Homes and the Northern Ireland Housing Executive

 Non-construction businesses (deemed contractors) which spend on average more than £1000,000 a year on construction operations

 A property developer or speculative builder, erecting and altering buildings in order to turn them in to financial account

 A labour agency or staff bureau supplying workers to perform construction operations

 A gang leader with gang members who are self employed.

COP

COP (Computerisation of PAYE) is the computer system that

 Holds (archived) records for PAYE taxpayers

Correction EOY return

A correction End of Year return is

For Tax Years 2004/05 and later

A correction to an earlier captured return or part return where an error was made in capturing the employer’s figures. (For example, only to adjust the capture details to match the P35).

Correction returns are not recorded as received before capture, and are not linked to a receipt record.

Where a P35 return is held at RSI1 on EBS and you capture a correction return, the correction will pass to the External Routing Interface Component (ERIC) and replace the return held at RSI1.

Where all P35 returns are held at RSI2 on EBS and you capture a correction return, the correction will not pass to ERIC and will add to the return held at RSI2.

For Tax Years 2003/04 and earlier

 An amended return

And

 Must only be made where amendment to a previously submitted End of Year return is required.

Under no circumstances must figures on the existing End of Year return be amended.

Correction returns are not recorded as received before capture, and are not linked to a receipt record.

Note: The capture of a correction return can be identified from the Return Receipt list box in the View EOY Return History screen.  The entries which will identify a correction return are

 A blank entry in the Return Type field

 A blank entry in the Date Field

And

 CORRECTION in the Return Class field

CSL

CSL (Collection of Student Loans) is a system under which HMRC is responsible for collecting repayments of student loans from UK residents.

D

Daily casual

A ‘daily casual’ is a worker

 Taken for no more than one day

 Paid off in cash by the end of the day

And

 There is no agreement for further work, even if further work may be expected.

Data Centre

The addresses for both Data Centres are

Banking Operations Shipley

Telephone 01274 539516

Fax 01274 539662

Data Protection (SAR) Unit

The Data Protection (SAR) Unit (DPU) is responsible for all aspects of processing subject access requests.

The DPU will

 Monitor HMRC’s adherence to the 40-day legislative deadline

 Issue the information retrieved in response to a SAR

Further information about registration procedures and subject access requests can be obtained from

Data Protection (SAR) Unit
IMS
Room BP4302
Benton Park View
Longbenton
Newcastle Upon Tyne
NE98 1ZZ

Telephone: 0191 2257575

Fax: 0191 2253098

DCNI Scheme type

A DCNI scheme type is appropriate when a simplified PAYE scheme is required to enable direct payments of National Insurance (NI only).

Collection of the deductions is quarterly during the year.

Debt Management & Banking (DMB)

Debt Management & Banking is a diverse business, which operates right across the United Kingdom. The service brings together IR and Customs and Excise functions. Banking Operations are based at Cumbernauld, Shipley, Newcastle, Southend, Liverpool and Greenock, while a network of offices in over 150 locations undertakes debt management activity.

The work of the Banking Operations offices includes

 Day to day payment processing and accounting work for employers, contractors and SA taxpayers

 Issuing assessments, demand notes and reminders

 Updating and maintaining taxpayer records

Debt Management office

The term ‘Debt Management’ office describes an office that undertakes recovery activity work. It includes

 Local Debt Management Offices

 Enforcement & Insolvency Services (EIS)

 Banking Operations Tracing Units

 Banking Operations Review Unit

 Banking Operations Public Department Collection

Debt Management Offices are responsible for

 All local action necessary to secure payment and outstanding returns.  This may be through the following methods

 Face to face contact

Or

 Making contact by telephone

 Taking distraint (poinding in Scotland) action or formal court proceedings to recover debts

These offices were formally known as Recovery Offices or Recovery Sections in Integrated Offices

Deduction year

The deduction year is the same as the tax year, and covers the period 6 April in one year to 5 April in the following year.

Direct debit

Payment by Direct Debit (DD) involves a bank or building society customer providing a written instruction permitting regular payments to be collected by a specified payee.

A taxpayer using the DD facility sends the signed instruction to HMRC.  Any DD instruction received in a local office is passed to Banking Operations.  Banking Operations records receipt and passes the instruction to the bank or building society.

Collection of the regular payments and update of taxpayer records is initiated by Banking Operations.

Director

A director is a person who is, either on their own or with one or more associates, beneficial owner of, or able, directly or through the medium of other companies, or any other indirect means, to control not less than 20 per cent of the ordinary share capital of that company.

In other words a director is someone who either on their own or with their fellow directors is or are the major shareholder(s) and control(s) the running of that closed company.

District Record

District Record is a filing range where non file case taxpayer papers are kept for retrieval at a later date.

DLO

‘Dead Letter Office’ identifies an address that is no longer recognised as a valid postal address.

In other words the address no longer exists because, for example, the building has been demolished.

DLO will appear alongside the STATUS field where a DLO address has been retrieved from Function ADDRESS SEARCH and stored on the employer record.

DOME Scheme type

A DOME scheme type is appropriate for employers of personal or domestic employees who are paid a fixed wage to deduct tax on a non-cumulative basis.

In practice the responsible Processing Office may also allow this ‘simplified deduction’ procedure to be used where an employee’s wages are variable and wages sometimes fall below the tax threshold, provided that all employees from whom tax and NIC will be deducted are personal and domestic employees of the employer.

In all cases the net taxable pay (after allowances) for each employee must not exceed £160 a week (£700 a month). When these limits are exceeded a DOME scheme is not appropriate and the employer record should be set up as a P Scheme.

Dormant

This term relates to a scheme when it is

 A limited company that is inactive

And / Or

 Has no employees liable to PAYE and / or NIC

DPGEN Scheme type

A DPGEN scheme type is appropriate when normal PAYE procedures are unsuitable and employees deduct Income Tax only for themselves.

This scheme type is appropriate for certain types of employees, office holders or individuals. They include

 Roman Catholic Priests

 Clergy of the Church of Ireland

 Officials whose earnings are made up mainly of fees paid by the public, for example, Registrars.

The employee is responsible for paying the income tax deducted to HMRC (Banking Operations).

DPNI Scheme type

A DPNI scheme type is appropriate where the normal PAYE procedures are unsuitable. The employee is responsible for the deduction of his or her own income tax and employees share of NI contributions.  Either of the following criteria may apply

 Certain types of employees or office holders, these include

 Roman Catholic Priests and Clergy of the Church of Ireland

 Officials whose earnings are made up mainly of fees paid by the public, for example, Registrars

 Certain employees of foreign and Commonwealth governments, for example, a British chauffeur on the staff of a foreign embassy

 An individual, who is required to pay their own NI. These include employees of

 A foreign embassy or consulate which has refused to operate PAYE, or a foreign employer who has no address in the UK from which earnings are paid.

The employee is responsible for paying the NI contributions to HMRC (Banking Operations).

DPTC

DPTC (Disabled Persons’ Tax Credit) was introduced in October 1999 to help lower-paid people whose earning capacity is reduced because of their illness, or disability puts them at a disadvantage in getting a job.

The credit replaced the Disability Working Allowance social security benefit, administered by the Benefits Agency (BA) and the Social Security Agency (SSA) in Northern Ireland.

Drill down button / icon

The ‘Drill down icon’ will be a ‘magnifying glass icon’ when opening the screen in View mode and a ‘pencil’ icon when opening the screen in Edit mode.

The Drill down button will appear at the end of the corresponding row.

Due date

Employers and contractors are required to send in their End of Year (EOY) returns within 44 days of the end of the deduction year. That is normally by the19th of May each year.

This period may be extended by a period of grace.

Duty geared penalty

A duty geared penalty is

 Imposed under S98A (2)(b) TMA 1970

- Considered where failure to submit an annual End of Year return continues for more than 12 months after the due date

 Determined without prejudice to any interim penalties already issued

 Only issued where it has been authorised by Tax Administration Advice (TAA)

E

EBS

EBS (Employer Business Service) is the computer system that

 Holds employer records

 Supports staff working on Employer sections

ECON Number

Where an employer elects that their employees are contracted out of the state earnings-related pension scheme (SERPS), HMRC will issue a contracting-out certificate to the employer. A copy will also be forwarded to the relevant Processing Office.

The certificate will confirm the employer's unique ECON number that should be quoted when completing the form P35, and in any correspondence with NICO regarding contracted out matters.

The ECON number will always commence 'E3' and be in the format E3NNNNNNL (N = number, L = letter).

You should file your copy of the contracted-out certificate in the employer file and make a note of the ECON number in the EBS Notes.

ECS

Employer Compliance System is a computer system that provides support for the processing, examining and reviewing of returns from employers.

EDI Employer

An EDI employer is one that submits information to HMRC electronically using Electronic Data Interchange (EDI). Employment Maintenance forms submitted by this means are

 P45(1) and (3)

 P46

 Pension notifications

EDI also allows employers to receive the following forms electronically on a daily basis

 P6

 Budget P6

 P9

ELECT Scheme type

An ELECT scheme type is appropriate when councils or local authorities make payments to individuals in respect of electoral duties. These include

 Returning officers

 Acting returning offices

 Presiding offices

 Polling clerks

 Counting assistants

 All others engaged in the conduct of public elections and referenda

Electronic filing

Means the method by which employers are able to submit their annual returns and other forms using electronic communications.

This service is known as PAYE Online filing for Employers.

The communication can be by either

 Internet

Or

 Electronic Data Interchange (EDI).

Note: Use of Magnetic Media is not considered to be an electronic communication.

Electronic payment

From 6 April 2004 large employers are required to make in-year PAYE / NIC payments electronically.

Approved methods of electronic payment include

 Direct Debit

 Internet, telephone banking or BACS Direct Credit

 Debit or Credit Card over the Internet: BillPay

 CHAPS

 Bank Giro Payment

And

 Post Office Payment

Employer

For the purposes of PAYE the term employer means any person who pays earnings.

An employer by definition is ‘an individual or business which employs workers’.

Please note however, that an employer will for the purposes of scheme types also include an individual within the Direct Payment or Direct Collection (Employee only NIC) arrangements.

Employer Data Exception Unit (EDEU)

The unit is located at Banking Operations, Shipley (formerly known as Accounts Office Shipley).

The EDEU are responsible for dealing with Data Exception Reports. These paper reports are generated where an update made to an employer record on EBS is rejected by BROCS.

Employer reference

These are the numbers and letters, alone or in combination, used by HMRC to identify an employer for the purposes of PAYE regulations.

All new employer references are system generated from April 2000 unless it is for a transferred record. See PAYE30015 for further guidance.

Employer references will always be prefixed by a 3-digit office number and consist of either a

 Manually allocated reference which must not exceed 7 characters and the first character of which must be in the range A - Z , 0 - 9

Or

 System allocated reference which is 7 characters in the format Aznnnnn, where

 ‘A’ is an alphabetic sequential character (not the initial letter of the employer’s name)

 ‘Z’ is a fixed character using the least used in alpha references

 ‘nnnnn’ are 5 numeric characters

Employers with diplomatic immunity

Employers with diplomatic immunity cannot be obliged to comply with the PAYE/NIC Regulations.

They include

 Embassies and High Commissions

 Consular Missions

And

 Certain international organisations. For example INMARSAT (International Maritime Satellite Organisation) and the European Centre for Medium Range Weather Forecasts

Enforcement office

The Enforcement & Insolvency Service is made up of three elements

 Enforcement Office (Belfast)

 Enforcement and Insolvency Service (Worthing) which embraces Debt Management and Compliance Services. Included under this umbrella is both the Voluntary Arrangement and Insolvency Service

 Enforcement Office (Scotland) which also includes the Civil Recovery Section

EPA Scheme type

An EPA scheme type is appropriate to record PAYE tax and National Insurance due on earnings paid to employees of companies in receivership, for example

 Holiday pay

 Arrears of pay arising before the receivership took place.

These are set up and closed on instructions from the Debt Management office.

ERIC

The External Routing Interface Component (ERIC) is a new computer component introduced to support the filing of employer annual returns in batches.

All return information, both paper and electronic submissions will pass through ERIC from April 2005.

For more information see PAYE41015.

EXAM Scheme type

An EXAM scheme type is appropriate where Universities and Polytechnics pay fees to examiners, invigilators, settlers and for all related duties in any way connected with

 GCSE and ‘A’ level examinations conducted by the various examining boards

And

 First degree examinations conducted by Universities

Expat team

There is a centralised Expat Team in Manchester (Trinity Bridge House) that deals with the taxation affairs of all inward expatriates. The team is part of CAR Expats.

F

Filed online

Filed online indicates that the employer has filed their annual return directly to HMRC by

 PAYE Online for Employers (Internet)

Or

 Electronic Data Interchange (EDI)

Fixed penalty

A fixed penalty is

 Imposed under S98A (2)(a) TMA 1970

 Issued and calculated automatically by ECS

 Based on the employer / contractor’s return details

 Subject to certain exceptions and exclusions

 Issued where an employer or contractor fails to submit their annual EOY return by the due date

Free pay

Free pay is the total amount of pay that an employee is allowed to receive free of tax up to (and including) the latest pay day. It is a proportion of the maximum allowance of the code.

Full lodgement account

A full lodgment account allows an office to bank cheque and cash payments on a daily basis. A security carrier calls each day to transport the lodgment to the bank.

Note: A cheque for less than £250,000 should be sent to Banking Operations for banking unless there is a compelling reason to bank it locally

G

Girobank

Girobank is a credit transfer system that enables payment to be made by

 Paying cash or cheque over a Post Office counter (referred to as Transcash), or

 Arranging a Girobank Transfer from an account holder’s Girobank account

The payment is credited to one of HMRC’s Girobank Accounts. The target Girobank account is indicated on the payslip. Each account is associated with one of the Banking Operations sites (Cumbernauld, Shipley or Newcastle).

Girobank notifies Banking Operations of the credits received daily in each Girobank account.

Greyed out

When on-screen buttons are inactive, that is they cannot be selected to perform a task, they are shown in a lighter grey than the active buttons. In guidance you see this referred to as greyed out.

This is done to avoid you using the button until you have entered all mandatory information required before further processing can take place.  Greying out reduces the need for validation and therefore the number of error messages that otherwise would be presented to you.

A greyed out button becomes active when, for example, you have

 Entered all required information

Or

 Made a selection from a list box

H

HMRC activity

There are four types of HMRC activity for which an office may be responsible in SA

 Processing

 Technical

 Debt Management

 Banking Operations.

When an office becomes associated with a taxpayer it assumes responsibility for one of the above areas of work for that taxpayer.

Only one office can have responsibility for a particular area of activity at any time.

An area of activity can be transferred from one office to another when appropriate, for example, when the main source of income changes.

HMRC Enquiry Centres

Formerly known as an IREC, Tax Enquiry Centre or TEC, the HMRC Enquiry Centre is responsible for handling face-to-face enquiries from customers. HMRC Enquiry Centres are situated nationwide.

HMRC Enquiry Centres will

 Give assistance on tax and NIC enquiries without a prior appointment

 Provide help and guidance on the completion of appropriate forms and returns

 Have suitable interviewing facilities

 Stock appropriate leaflets

 Handle customer’s payments

I

IABD

Income, Allowances, Benefits and Deductions.

IABD is a repository for all information relating to an individual’s income, allowances, benefits and deductions. Information is stored for each tax year.

Icon

An icon is a graphical representation, or picture. Usually you will select the icon to access the system, Computer Based Training or Manual represented by the icon.

Incentive Award Unit

The unit is responsible for all Taxed Award Schemes and enquiries should be referred to

HMRC Incentive Award Unit
Chapel Wharf
Trinity Bridge House
2 Dearmans Place
Salford
M3 5DS

Telephone number - 0161 261 3269

Incentive payment

Small employers (0-49 employees) are being offered tax free incentive payments to encourage them to use online filing to file their annual returns.

Both form P35 and forms P14s must be filed on line to qualify for an incentive payment.

The incentive payments are as follows

 2004-05 - £250

 2005-06 - £250

 2006-07 - £150

 2007-08 - £100

 2008-09 - £75.

The incentive will be given by BROCS as a credit against the account for the year in which the return was successfully filed on line.

Information Commissioner

An Information Commissioner

 Is appointed to ensure that all organisations included within the scope of DPA confirm with the Act

 Has a range of powers available to ensure that this is achieved.

Inland Revenue Information Service

The Inland Revenue Information Service (IRIS) is a computer system for Banking Operations.

Depending on your level of access, IRIS allows you to

 View taxpayer records held on the Banking Operations computer

 View and search the Banking Operations indexes of taxpayers

 View payments held in the Overpayments and Accounting Summary (OAS)

 Calculate interest and repayment supplement

 Take screen prints of information shown

 Update taxpayer records

 Prepare and print pro-forma payslips

Insolvency Claims Handling Unit

The Insolvency Claims Handling Unit (ICHU) can be contacted at the following office

NICO Contrib 5 and ICHU

BENTON PARK VIEW

LONGBENTON

NEWCASTLE UPON TYNE

NE98 1ZZ

Switch Board – 0191 213 5000

Fax – 0191 225 4002

IRIS

IRIS stands for Inland Revenue Information System. A separate IRIS system is maintained for each Banking Operations office.  IRIS provides a NEWSboard and enables an operator to

 View and update taxpayer records for Banking Operations$ systems other than BROCS, CT Pay and File and SA

 View AO taxpayer indexes and overpayment records

 Calculate interest and repayment supplement

For more information about IRIS see the IRIS Systems and Services Manual.

IRO

Until April 2007 there were 5 IROs (Inland Revenue Offices).  These were specialist offices based in St Austell, Glenrothes, Sefton and Leicester dealing with annual repayment claims from individuals whose main source of income arises from investments.

The work is now concentrated in one specialist office, Leicester and Northants Claims Office.

ISP

'Internet Service For PAYE'

Means by which employers may register to file certain forms as a package using the internet.

Now known as PAYE Online For Employers - Internet'.

Formerly known as 'Filing By Internet (FBI)'.

ITSO

Information Technology Support Officers.

A New IT Service Centre on 0845 605 2121 was established in August 2006 to manage the work formally carried out by local ITSOs.

L

Landing screen

This is the screen used to record the receipt of information from individual’s, agents, letters, forms, telephone calls.

Large employer

A large employer is one with 250 or more live employees.

Each employer record (scheme) is placed into one of four segmentation bands.

A large employer is required by law to use online filing to file their annual end of year returns and make payments by electronic means for all tax years from 2004/05.

Limited company

A limited company is one whose shareholders own that company, however the shareholders liability for that company’s debts is restricted.

Limited liability partnership

Limited Liability Partnership rules allow the income and gains of a company to be taxed on its members as if they were partners in an ordinary partnership.

Linked employees

This term relates to any employee who has ever been associated with that particular employer, and will include

 All ‘live’ employees and directors which have a computer record with no end date that is either in the past or in the future (for example WTC)

 All former employees and directors who have now left

 All ‘live’ or former employees and directors who have been paid tax credits, including those paid below the threshold for PAYE

Liquidation

Liquidation is the legal process for dealing with a company who is unable or unwilling to pay their debts

There are two types of liquidation

 Compulsory

And

 Voluntary.

A liquidator will be appointed to handle the liquidation to

 Administer the company’s assets

And

 Distribute them amongst the creditors in accordance with their rights.

There is no fixed term for a liquidation and a company can only be liquidated once.

Live employer

An employer record is live when it contains none of the following

 An end date due to succession or cancellation

 Details of a transfer out, merger out or succession out

M

Mailing contractor

The term mailing contractor refers to a company contracted by HMRC to deliver output on their behalf.

Examples of output mailing contractors are responsible for issuing include

 Employer Starter Packs

 >Employer and Budget Packs for new and existing employers

 P9 coding notifications

 P6 coding notifications.

Management unit

A Management Unit (MU) is either the whole or two or more parts of an office.

Each MU is more or less treated as an office within an office. Each MU has

 Responsibility for specific taxpayer records

 Designated terminals attached to it.

The number of MUs an office is divided into is usually for local management to decide.

Mediated

Contacts resulting from direct interaction with an individual.

Medium employer

A medium employer is one with 50 to 249 live employees.

Each employer record (scheme) is placed into one of four segmentation bands.

A medium employer is required by law to use online filing to file their annual end of year returns and make payments by electronic means for all tax years from 2005/06.

N

NESI

New Enterprise Support Initiative or NESI was created to

 Help HMRC support new (and prospective) small and medium size businesses

And

 Reduce the burden of tax and NIC administration

And in doing so

 Drive down the costs of compliance for Government departments.

This will be done through

 A new introductory leaflet – ‘First Steps As A New Employer’

 A special Helpline for new and prospective employers

Telephone number 0845 60 70 143

Open 8am – 8pm Monday - Friday, Sunday - 10am - 4pm  Calls charged at local rate

 Regionally based Business Support Teams (BSTs), IR staffed, to provide dedicated support, assistance and education.

 A customised New Employer Starter Pack which includes booklet ‘Next Steps As A New Employer – Paying Someone For The First Time’.

Net adjustment

This is the monetary amount reported on an End of Year return.

This amount does not take into account any earlier End of Year returns that may have been received for that employer record in that year.

Example

If three End of Year returns have been received for an employer record for a year they would be entered on each screen as follows

Return Class

Original return showing total tax due of £100.00

Additional return showing a further £50.00 tax due

Corrected return showing a figure of minus £10.00 tax

Network Unit

The Network Units are located in

 Banking Operations Cumbernauld

And

 Banking Operations Shipley.

The Network Units deal with the collection and recovery work associated with tax charges shown on certain types of assessments and determinations which are issued clerically.

These include

 Investigation Settlements made on Forms 94

 Penalty Determinations issued on Forms 394

 Regulation 80 Determinations issued on Forms P380

 Pension Fund Surpluses

NICO

NICO stands for National Insurance Contributions Office.

This is an Executive Office of HMRC responsible for managing the National Insurance System.

Formerly NICO were part of the DSS and known as the Contributions Agency.

NINO

Each National Insurance contributor is allocated a unique reference, a National Insurance number (NINO), by the National Insurance Contributions Office (NICO).

A NINO consists of two letters then six numerals then one letter.

For example AB123456C

Although the full 9 characters are normally entered on HMRC computer records, it is usually sufficient to enter only the first 8 characters to access the computer record.

NI Scheme type

An NI scheme type is appropriate when

 Wages paid exceed the lower earnings limit for National Insurance contributions

But

 Are below the threshold for tax

Non live employer

An employer record which contains one of the following

 An end date due to succession or cancellation

 Details of a transfer out, merger out or succession out.

NORPRO Scheme type

A NORPRO (Norwegian Protocol) scheme type is used only by Centre 1 to denote an employer resident in a country that has an off shore article in their Double Taxation Treaty with the UK. For example: Norway, Denmark, or the Netherlands.

The foreign employer operates a special system of UK tax deduction using simplified tax tables and End of Year return that are supplied by Centre 1.

O

OAS

OAS stands for Overpayments and Accounting Summary. There is a separate OAS computer operating in, and maintained at each Banking Operations site.

OAS handles the reconciliation for all payments that are sent to them (except SA payments) and is used to

 Temporarily hold payments that cannot be allocated to either an employer or taxpayer record

 Transfer payments between records

 Repay amounts directly to the employer or contractor

OCPN Scheme type

An OCPN (Occupational Pension) scheme type is appropriate when an occupational pension provider makes pension payments to

 Former employees

Or

 Dependants of deceased employees

Online filing

By 2010 all employers, with a few exceptions, will be required to file their annual return online.

Online filing means sending information direct to the HMRC computer cutting out paper. There are three options available to employers

 PAYE Online from a software package or the HMRC Online Return and Filing - PAYE. This is filing by Internet

 Electronic Data Interchange (EDI). This is effectively a direct link between the employer and HMRC. It is likely to be appropriate for only the very large employers and some payroll bureaux / agents

 Using an intermediary, such as a payroll bureau or agent, who will submit the annual returns on the employer’s behalf using one of the above.

Note: We must have a signed FBI 2 authorisation before we can send information to agents using PAYE online for Employers - Internet. We can however receive information, on behalf of the employer from any agent or representative.

Both form P35 and forms P14 must be filed online.  Employers may be liable to a penalty or miss out on incentive payment if one part is returned on line and one by other means.

Submission of Magnetic Media is not considered to be online filing.

Online Services helpdesk

The Online Services Helpdesk contact details are as follows

Tel: 0845 60 55 999

Overseas: +44 161 930 8445

Fax: 0845 366 7828

Minicom: 0845 366 7805

e-mail: helpdesk$ir-efile.gov.uk

Internet: www.hmrc.gov.uk

Opening Times: 8.00am to 8.00 pm 7 Days a week (closed Christmas Day, Boxing Day & New Years Day.

Organisation Unit

An Organisation Unit is an office or Management Unit within an office.

A unique 6 numeral identifier is allocated to each Organisation Unit.

The first numeral is the office type identifier, that is

 ‘2’ for offices responsible for processing work irrespective of any debt management activities they may perform

 ‘3’ for offices which exclusively perform debt management work.

Followed by

 The three numeral office number, including any leading zeros.

Followed by

 The two numeral Management Unit number, including a leading zero, if appropriate.

For example, Management Unit 05 – responsible for processing work - in office 091 is identified as ‘209105’

Original complete return

An original complete annual return is the first return captured in a year where the employer has submitted a P35 together with all expected P14s.

In the case of a PSC scheme where either P35 and a CIS36 are received at the same time, and both are captured at the same time, whichever return was captured first is treated as the ‘original’ for that employer record.

Original part P35 return

Original Part P35 shows that the return is

 The first return to be captured for that employer for that year

And

 A P35 on its own without any forms P14.

Note: In the ‘Employer Further Guide to PAYE and NICs (CWG2)’ Para 13, we recommend that the P35 is submitted last to enable the correct number of batches of P14 parts to be entered on the P35.

Original EOY return

An original End of Year return is the first End of Year return captured for an employer in any year.

In the case of a PSC scheme where a P35 and CIS36 are received, providing both are captured at the same time both returns are treated as ‘originals’ for that employer record for that year.

Output

The PAYE Service generates and issues a range of forms and letters to individuals, agents, employers and capacitors, these are known as ‘outputs’.

There are two main types of output from the PAYE system

 Bulk issues of a form to many individuals and agents at about the same time, such as the P2 Notice of Coding

 Individual issue or re-issue of a letter or form when required

Overpayments account (Book 19)

The overpayments account (book 19), also referred to as an overpayments register, is a suspense account to which payments banked by a Processing Office or Debt Management Office are allocated temporarily.

The overpayments account is used where, for example, the

 Charge to which the payment relates cannot be traced

 Payment allocation details are not clear

Or

 Payment is intended for NICO or the TCO.

Once any enquiries have been completed the Processing Office or Debt Management Office normally clears the overpayments account entry by

 Transferring the payment to duty either locally or to another office

Or

 Arranging for a payment to be issued to NICO or TCO.

P

P228 Consecutive number

Form P228 is automatically generated by the computer as a result of capturing a return and is sent direct to the Processing Office.

Consecutive numbers are allocated per office for each return in the order in which they are captured.

Each P228 will have its own unique consecutive number.

Note: Only one copy of the P228 is produced. There is no office copy.

Function VIEW EOY RETURNS HISTORY can be used to view each P228 generated.

P239 list

Form P239 is a summary list automatically generated by the computer of between one and twenty forms P228. It is sent directly to NICO. A copy is not forwarded to the Processing Office.

Each P239 contains

 Number of schemes for processing

 Tax District number

 P239 List number

 Date of issue

 P228 consecutive number

 Employer's name

 Employer reference number

 Tax year

 Number of returns

 Remarks

P239 list number

Form P239 is automatically generated by the computer as a result of capturing a return and is sent direct to NICO.

Each form P239 is allocated a list number

Part P35 return

A part P35 return is one where the employer has submitted a P35 without the expected forms P14 required to make a complete return.

Note: In the ‘Employer Further Guide to PAYE and NICs (CWG2)’ Para 13, we recommend that the P35 is submitted last to enable the correct number of batches of P14 parts to be entered on the P35.

Pay adjustment tables

These tables show the weekly and monthly pay adjustment figures. They give you the correct figure of

 Free pay, where the code is a suffix code

Or

 Additional pay, where the code is a K code

Payment card reward scheme

A payment card reward scheme is

 A scheme set up by a payment card company, bank or building society to tax payments of cash made to an employee or third party retailer who passes this on to their employee as a reward for the recovery of a lost or stolen payment card or cheque guarantee card

PAYE20110 gives further details.

Payroll agent

A payroll agent is a person or group of persons appointed by an employer to handle their payroll.

You must ensure that the payroll agent’s details are entered on the employer record in the appropriate PAYROLL & CORRESPONDENCE DETAILS fields.

An appointed payroll agent will receive all automated correspondence issued by HMRC and deal with all of the following

 Operation of PAYE

 Employer’s copies of coding notices

 Payslips

 >Employer Pack

 End of Year returns

 General employer correspondence.

A payroll agent may also act as agent for the employer dealing with other areas of an employer’s tax affairs for example penalties and assessments.

When the payroll agent does also act in other areas of an employer’s tax affairs you should set the Agent indicator on the employer record using Function

 AMEND EMPLOYER SUMMARY for an existing employer record

 EMPLOYER SET UP when setting up a new employer record

Period of grace

This period of grace is additional time for an employer to submit an End of Year return, to accommodate delays in transmission (postal delays).

Extra Statutory Concession (ESC) B46 states that ‘The Inland Revenue will not charge a penalty if a return is received on or before the last business day within seven days following the statutory filing date’.

A business day is any day other than a Saturday, a Sunday, Christmas Eve, Good Friday or any bank or public holiday.

Permanent overpayment

An overpayment arising on the Banking Operations record is to be regarded as a permanent overpayment where

 The amount does not exceed £10 (this was £100 between April 2003 and September 2003) and repayment, reallocation or transfer has not been requested by the employer or contractor

Or

 The amount exceeds £10 (this was £100 between April 2003 and September 2003) but cannot be related to particular employees or subcontractors

Or

 The employer / contractor has refused repayment or credit to a later year

Or

 Any other reason exists which makes repayment, reallocation or transfer inappropriate, at the time or at any time in the future

PID

(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)

POP return

This term is used to describe a return that has been completed and authorised by the Debt Management office which is subsequently sent to a processing office to enable a permanent overpayment to be cleared.

Portal

A portal or gateway provides access to specified information and services.

Employers are able to file their returns using the following portals

 Electronic Data Interchange

 Internet

Principal employer

In relation to a TRONC scheme, the principal employer is the person or body who pays the employees wages.

Privileged user

A Privileged User is allowed to use certain COP / CODA functions on taxpayer records outside the parent Management Unit (MU).

Processing Centre

A Processing Centre (or Data Centre) is responsible for producing the ‘Daily batch’. This is the computer action for processing information from on-line functions and printing the output from it.  An example is the issue of forms P2 and P6 from Daily Coding functions.

Processing office

The Processing Office is the office which is specifically responsible for

 Maintaining employer records

 Day to day work on employer aspects

 Processing employer returns

Pro-forma

This indicates that the return has been completed on behalf of an employer or contractor.

It is not a return that is received from the employer.

For tax years up to 2004

Pro-forma returns are not recorded as received prior to their capture.

For tax years 2005 onwards

Pro-forma returns must be recorded as received prior to their capture.

Note: Quality standard checks do not apply to pro-forma returns.

EBS Function RECORD RETURN RECEIPT must be used to record receipt of the returns as having ‘passed’ the paper quality check.

P Scheme type

A P scheme type is appropriate for all organisations and businesses making payments to employees, pensioners and office holders, for example, directors.

The employer must operate PAYE in all the following circumstances

 When making a payment of earnings to an employee or when an employee becomes entitled to payment

 On all payments above certain limits

 When the Processing Office tells him or her to use a certain code

PSC Scheme type

A PSC scheme type is appropriate when

 A contractor in the construction industry makes payments to a subcontractor

And

 As an employer they have employees liable to PAYE deductions

PSS Scheme type

A PSS scheme type is appropriate when

 The Trustees of a Profit Sharing Scheme make a payment on behalf of an employer in respect of shares given by that employer to its employees

And

 The recipient shareholders are now neither

 Employees of that employer

Or

 Pensioners receiving an occupational pension from that employer

The trustees are required to deduct tax from these payments under PAYE using code BR.

R

Radio button

A radio button is used to set a signal or indicator on the employer or taxpayer record.

It is presented as a circle

 Blank where it does not apply

 With a black dot in the centre where it does apply

To set the signal or indicator

 Select the radio button

For example

 Where the taxpayer is a Director you will select the DIR radio button to set the indicator

Reasonable excuse

This term is not defined by statute, but broadly speaking a ‘reasonable excuse’ is

 An exceptional event beyond a person’s control which prevented a return being sent back by the deadline or tax and NIC being paid by the due date

 Not prescriptive and must be considered based on the facts of that case.

Recovery Office

The term Recovery Office includes

 Local Debt Management Offices

 Enforcement & Insolvency Services (EIS)

 Banking Operations Tracing Units

 Banking Operations Review Unit

 Banking Operations Public Department Collection.

It excludes the Recovery Group Offices (RGO) and other areas of Debt Management & Banking.

Registered (Data Protection Act)

The Data Protection Act makes provision for a Data Protection Registrar and the setting up of a register in which personal data and the purpose or purposes for which it is held must be registered.

HMRC computer systems are included in the register.

The information in the register is open to public inspection.

Responsible Organisation Unit

The responsible Organisation Unit is an office or Management Unit (MU) within an office that has responsibility for the employer record.

A unique 6 numeral identifier is allocated to each responsible Organisation Unit.

The first numeral is the office type identifier, that is

 ‘2’ for Processing and Technical Offices (irrespective of any recovery activities)

 ‘3’ for offices which exclusively perform recovery work.

Followed by

 The three numeral office number, including any leading zeros.

Followed by

 The two numeral MU number, including a leading zero, if appropriate.

For example, Management Unit 05 in Processing Office 091 is identified as ‘209105’.

Return

All employers / contractors must submit a return for each year in which they have made payments to their employees or subcontractors.

The return includes details of

 Payments and deductions made for individual employees / subcontractors

 Amounts paid over to Banking Operations

 A signed declaration.

The type and combination of forms required will depend on the PAYE scheme type operated.

All returns must be on an official P35 employer annual return.

Return Class

When returns are captured for tax years 2005 onwards they are classed in one of 5 ways

 Original Complete

 Original Part P35

 Additional Complete

 Additional Part P35

 Correction.

When using Function VIEW EOY RETURNS HISTORY, if the Return Class is blank for any particular return then the details for that return have not yet been captured.

For tax years up to 2004 the Return Class will be either

 Original

 Additional

Or

 Correction

Return part

From April 2005 an employer (or their agent) operating a PAYE scheme can submit their employer’s annual return (P35 and forms P14) in parts using different channels – Internet, EDI, paper and Magnetic Media.

If an employer intends to send the whole return by paper, then the return must be submitted as a complete return and not in parts.

Where an employer chooses to submit their return in parts they will need to

 Record the number of parts, in which forms P14 will be sent, on the form P35

 Attach a P14 Cover sheet for each paper part P14 that is sent. The employer will also need to provide a unique identifier for each part P14 submitted.

RLS

Where for example Royal Mail is unable to deliver a communication, it will be returned to the sending office (either direct or via Cumbernauld) by their Returned Letter Section.

An RLS indicator should be set on the Employer Business Service (EBS) employer record for either the Business address or Correspondence address when you receive undelivered mail or are notified that the address held is no longer valid.

Function AMEND EMPLOYER SUMMARY is used for this purpose.

RSI

The Return Status Indicator (RSI) will indicate the stage an employer return has reached in the ERIC consolidation process.

The RSI entries will indicate

 ‘1’ That the return has yet to be consolidated within ERIC (awaiting receipt of one or more parts)

 ‘2’ That the return has been consolidated within ERIC (all expected parts have been received)

 ‘3’ That the return cannot be consolidated within ERIC (all expected parts have not been received)

S

SA

SA (Self Assessment) was introduced in the 1994 Finance Act.

For individuals who receive returns, and for partnerships and trusts, the first year of self assessment was 1996-97.

An SA computer system

 Holds SA taxpayer records

 Supports staff in the administration of Self Assessment

SA Taxpayer reference

The SA taxpayer reference must be one of the following

 10 character UTR (Unique Taxpayer Reference) in the format 9999999999

 First 8 characters of the NINO in the format AA999999

 8 character temporary reference number in the format 99A99999

Scheme index supplement printout

This list or printout

 Provides an analysis of the types of employee (SA and Non SA) associated with a specific employer

 Presents this information in groups of 100 employees indicating only the names of the first and last employee within that range

And

 Is used to determine the size and content of a particular employer record

Segmentation

This term is used to describe the annual process of categorising each employer record (scheme) into one of four segmentation bands.

This information is used for the purposes of determining if and when an employer is required by law to use online filing to file their annual end of year returns.

Segmentation band

Each employer record (scheme) is placed into one of four segmentation bands for the purposes of determining if and when (between April 2005 and April 2010) an employer is required by law to use online filing to file their annual end of year returns.

The four segmentation bands are

 Schemes with 250 or more live employees

 Schemes with between 50 and 249 live employees

 Schemes with 49 or less live employees

 Schemes that are excluded from being required to file electronically (for example certain scheme types).

Large and medium employers can appeal against using online filing on religious grounds. If the appeal is successful the schemes will be exempt from filing electronically.

Segmentation count

The number of live employees associated to an employer record at the time of the annual review date.

This information is used to determine when (between April 2005 and April 2010) an employer excluding those exempt or excluded is required by law to use online filing to file their annual end of year returns.

SICK Scheme type

A SICK scheme type is appropriate where a third party is responsible for paying sick pay to the employees of more than one employer, for example, an insurance company.

Simplified tax tables

Table P16 is given to employers of personal and domestic employees who use the P12 card procedure.

The table

 Is simplified and non cumulative

 Includes instructions to the employer

 Can be used for weekly or monthly paid employees

And

 Must not be issued to commercial or industrial employers.

As free pay tables are not issued with cards P12 you must enter the free pay for Week 1 / Month 1 on each card before issuing it.

Start Notice

A Start Notice (form SL1) is a computer generated form that is automatically sent to an employer when either

 A successful match is achieved between the Students Loan Company record of borrowers and HMRC PAYE computers

Or

 A form P45 relating to a borrower is processed by HMRC and has no entry in the Student Loans box.

The Start Notice instructs the employer to start making Student Loan deductions from the first available pay day following the Start date shown on the form.

Start Notices are not issued annually in respect of the same borrower.  The instructions in the Start Notice continue to apply until the loan is repaid or otherwise cancelled.

There is no clerical version of the Start Notice and stocks are not supplied to local offices.

Statutory Adoption Pay (SAP)

Statutory Adoption Pay is available to

 Individuals adopting a child on their own

Or

 One member of a couple adopting a child together

There are qualifying conditions for SAP.

If a couple are adopting the child jointly, SPP may be payable to the one who is not receiving SAP.

For those eligible parents, payments will be made via their salary.  The employer can then claim back

 92% of any payments made

Or

 100% (plus compensation) if they qualify for Small Employers Relief (SER).

Statutory Paternity Pay (SPP)

Statutory Paternity Pay is available to

 Biological fathers

 The mother’s husband or partner

 One member of a couple adopting a child together

 The adopter’s husband or partner.

There are qualifying conditions for SPP.

For those eligible parents, payments will be made via their salary.  The employer can then claim back

 92% of any payments made

Or

 100% (plus compensation) if they qualify for Small Employers Relief (SER).

Stop Notice

A Stop Notice (form SL2) is a computer generated form that is automatically sent to an employer when either

 The Student Loans Company estimate that a loan is about to be repaid

Or

 The loan is to be cancelled or Student Loan deductions are to cease for some other reason

The Stop Notice instructs the employer to stop making Student Loan deductions from the first available pay day following the Stop date shown on the form.

There is no clerical version of the Stop Notice and stocks are not supplied to local offices.

Sub-account

The sub-account is a reference that is made up of

 The tax group reference

And

 ASN (assessment sub number)

For example 123 PX 12345678 9901.

It forms with the instalment reference the overall Collection reference that is used to identify each employer record on BROCS.

Subcontractor

A subcontractor is any business that has agreed to carry out construction operations for another business or public body, which is a contractor.

The term subcontractor includes

 A company, any corporate or public body, as well as any individual self-employed person running a business or partnership

 A labour agency or staff bureau which contracts to either get work done with its own workforce , or to supply workers to a contractor

 A foreign business if the construction operations take place in the UK

 A local authority if they are engaged on construction operations for someone else

 A gang leader who agrees with a contractor on the work to be done , and receives payment for the work of the gang

Subcontractors holding CIS6 certificates

A Subcontractors Tax Certificate (CIS6) permits the contractor to make payments to the subcontractor named on the certificate without deduction of Income Tax.

Subcontractors holding registration cards

A Registration Card (CIS4) is held by a subcontractor.  This shows that a subcontractor is registered with the Construction Industry Scheme (CIS).

Production of this card allows a contractor to pay the subcontractor named under deduction of tax.

Subject access enquiries (Data Protection Act)

See Subject Access Requests.

Subject access officers

Subject Access Officers (SAO) have the specific responsibility of taking over and working any subject access requests in conjunction with the case owner(s) and with the support and guidance of the Customer Relations Manager and Debt Management Managers.

The SAO will

 On receipt of a subject access request notify the Customer Relations Manager and the Debt Management Manager

 Fax a copy to the Data Protection Subject Access (DPSAR) team in Longbenton

 Ensure retrieval and collation of the relevant records

 Edit those records as necessary in strict accordance with the exemptions permissible under the terms of the Data Protection Act

 Working with the DPSAR team provide access to the individual in the most appropriate form

Subject access requests (Data Protection Act)

Data subjects are individuals for whom information is recorded on computer, or on clerical records. Subject access requests (SARs) are applications from individuals for details of the information about themselves that is held by HMRC.

Summary bank facilities

>A summary bank facility is a method of banking payments of £250,000 or more.

Submitter

A submitter submits a return or return part by paper or Filed Online as an employer or on behalf of an employer.

Surcharge

From deduction year 2004-2005, large employers (those with 250+ employees) are required to make monthly payments of PAYE / NIC deductions in full and on time by an approved electronic method.  Where the employer fails to comply, HM Revenue & Customs will impose a surcharge at the end of the deduction year when the P35 is processed.

Where a surcharge has been imposed, posting type ‘SUR’ will be displayed in Function VIEW BROCS (POSTINGS SUMMARY) (Format 3). Any amendment to the surcharge, for example where the P35 has been amended, will be shown as posting type ‘ASR’.

T

TAS Scheme type

A TAS scheme type is appropriate when providers of incentive awards have entered into special accounting arrangements for paying the basic rate tax liability on non-cash awards made to their own or to other people’s employees.

This means that the provider and not the person receiving the award, pays the basic rate tax.

Taxable Pay Tables

These tables are used to calculate the tax due on an employee's taxable pay on any given pay day

 The taxable pay for a suffix code is total pay to date less the free pay to date

 The taxable pay for a K code is total pay to date plus the additional pay to date

Tax Administration Advice Unit

For advice on appeals procedures and appeals on religious grounds contact

Tax Administration Advice

Tax Appeals Policy

Room 1C/26

100 Parliament Street

LONDON

SW1A 2BQ

020 7147 2397 or

020 7147 2273

Tax Equalisation

HMRC >and Tax Professionals often use the words ‘Tax Equalisation’ to refer to contractual arrangements between employers and employees, where

- >Employees are entitled to specified net cash earnings and non-cash benefits

>And

 >Employers undertake to meet the UK income tax arising from the provision to the employees of the cash and the benefits

Tax free payment

Small employers (0-49 employees) are being offered tax free incentive payments to encourage them to use online filing to file their annual returns.

Both form P35 and forms P14s must be filed on line to qualify for an incentive payment.

The incentive payments are as follows

 2004-05 - £250

 2005-06 - £250

 2006-07 - £150

 2007-08 - £100

 2008-09 - £75.

The incentive will be given by BROCS as a credit against the account for the year in which the return was successfully filed on line.

Tax geared penalty

See Duty Geared Penalty.

Tax payment voucher

Tax Payment Vouchers (CIS25) is a 3-part form issued to all contractors set up on the CIS system.

The vouchers are personalised and contain the following details

 Contractor name

 Contractor tax reference

Three types of the CIS25 voucher are available to contractors

 CIS25(M), a manual voucher

 CIS25(I), an impact printable voucher

 CIS25(E), an electronic voucher

Tax Tables

A set of official Tax Tables will normally consist of

 Tables A - Pay Adjustment Tables

 Tables SR + B to D - Taxable Pay Tables

 Calculator Tables.

If the employer operates the Simplified Tax System they will receive instead

 Form P16 - Simplified Deduction Scheme - guidance on how to complete a form P12 and the simplified tax tables

TCO

TCO stands for Tax Credit Office. This office was set up in October 1999 and replaced the Family Credit Unit.

The TCO is responsible for the administration of the Tax Credit System (TCS).

Technical Support System

A Technical Support System (TSS) is a local software application that can be accessed from your Desktop menu. TSS provides assistance with a range of regular everyday tasks that are performed frequently in a large number of offices.

These tasks are often related to one or more of the many existing mainframe systems. A TSS is a fast and effective way of supplementing mainframe facilities and supporting processes (for example, the calculation of chargeable gains) that with a mainframe system are largely clerical.

Temporary number

Note: From the year 2004/05 temporary NINOs must not be used on P14 returns. If a NINO is not known, the employer should leave the NINO box blank and complete the date of birth and gender in appropriate boxes.

A Temporary Number is sometimes created by an employer for a new employee who does not provide the employer with a National Insurance number (NINO).

A Temporary Number is created in the following format

 TN

Followed by

 Six numbers

Followed by

 M or F.

For example TN010282M

This is not a NINO and must not be entered in Function MS to set up a taxpayer record. For more information about Temporary Numbers see PAYE60035.

Temporary reference number

A temporary reference number was allocated to a taxpayer by the COP computer when a record was set up and the NINO was not known.

The temporary reference number is produced in the following format

 Two numbers

Followed by

 One letter

Followed by

 Five numbers

For example 12A34567

Note: From the year 2004/05 temporary NINOs must not be used on P14 returns. If a NINO is not known, the employer should leave the NINO box blank and complete the date of birth and gender in appropriate boxes

Tracking Tool

The Tracking Tool is the part of the External Routing Interface Component (ERIC) used to track the progress of an employer annual return or return part through various parts of the End of Year process.

The tracking tool is used to

 Record incoming annual return, or return part information

 Record the progress of a return through the stages on the End of Year process

 Record annual return, or return part deletion information

 Record outgoing complete annual return details

Trade Class ‘C’ – Limited company

A limited company is one whose shareholders own that company.

However the shareholders liability for that company’s debts is restricted.

Trade Class ‘E’ – Investment company

An investment company within Section 130 ICTA 1988 is any company

 Whose business consists wholly or mainly in the making of investments

And

 The principal part of whose income is derived from those investments

Included in this meaning is any savings bank, or other bank for savings.

Trade Class ‘F’ - Partnership

A partnership refers to the relationship between two or more people who run and own a business together and share its profits or losses.

Trade Class ‘I’ – Individual or sole trader

An individual or sole trader business is one that is owned and run by one person.

Trade Class ‘L’ – Local authority

A local authority is a body that has the statutory power to bill or make demands in accordance with Local Government Finance Acts, for example

 County Councils

 District Councils

 Metropolitan Boroughs

And

 Parish Councils (Community Councils in Wales).

Trade Class ‘P’ – Public corporation

A public corporation is a corporate body

 That has been established by or in accordance with the provisions of any enactment (Act of Parliament)

And

 Has a membership consisting of or including persons appointed as members by a Minister of the Crown.

Trade Class ‘S’ – Registered society

A Registered Society is one that is registered by the Registrar of Friendly Societies under Section 8 of the Friendly Societies Act 1974. It will have a registration number and Financial Institutions Division will deal with any question of whether or not a society is registered.

Some registered friendly societies have a federal structure consisting of a central organisation which has local branches tied to it. These will generally have the word ‘Order’ in their titles. For example, ‘Ancient Order of Foresters’.

Trade name

The trade name is the name under which the employer trades. It is also referred to as the business name.

Troncmaster

The troncmaster is the person operating the TRONC. This may be the headwaiter or some other employee who agrees to do this.

For tax purposes, a troncmaster who accepts and understands the responsibilities of the position is regarded as an employer and is required to operate PAYE on each payment from the TRONC.

TRONC Scheme type

A TRONC scheme type is appropriate where

 A separate organised arrangement exists to distinguish and / or services through someone other than the principal employer

 The Troncmaster undertakes the duties of collection, custody and payment of the tips.

U

Unique identifier

A unique identifier is added by the employer to each of the parts of the return submitted.

Each unique identifier can be a combination of up to twelve characters using letters and / or numbers, which have not been used to submit any other parts of the return for the same year.

Unmediated

Contacts resulting from non direct interaction with individuals.

Unprocessed transaction

This is a transaction that has been completed but has not yet been processed because, for example

 It needs supervision

 A batch function has not yet been run.

User role

A user role reflects a particular job, and will determine the functions that you can use to perform that job.

Each officer is allocated those user roles, and the functions associated with those roles, that are necessary to perform its business.

Your office manager will allocate the user roles you need to perform your job.

You can be given any number of user roles, depending on the activities that you are expected to perform.

UTR (Unique Taxpayer Reference)

A UTR (Unique Taxpayer Reference) is a unique set of 10 numerals allocated automatically

 By the SA computer system when a taxpayer record is set up

 By the CT computer system when a company taxpayer record is set up. The same UTR will be used to set up an SA record for the company, where required.

V

Version number

Every End of Year return captured on the Employer Business Service (EBS) is allocated a version number.

The first return captured for an employer record, for each year will be given the version number ‘1’ and any subsequent returns captured for that year will be allocated the next consecutive number.

Use Function VIEW EOY RETURNS HISTORY to view all versions of an End of Year charge information.

W

WFTC

WFTC (Working Families’ Tax Credit) was introduced in October 1999 to provide in-work support for lower-paid families.

The credit replaced the Family Credit social security benefit, administered by the Benefits Agency (BA) and the Social Security Agency (SSA) in Northern Ireland.

WTC

WTC (Working Tax Credit) replaced WFTC (Working Families’ Tax Credit) to provide in-work support for lower-paid families.

Windows

Windows is the name given to the graphically based computer operating system employed on most personal computers (PCs). The majority of HMRC mainframe computer systems use a Windows type operating environment to communicate with operators.

The Employer Business Service looks and acts in the same way as Windows based programmes like ‘Word’ and ‘Excel’.

X

XP Scheme type

A XP scheme type is appropriate when a contractor in the construction industry makes payments to a subcontractor under a contract relating to construction operations.