PAYE13105 - coding: coding: general principles: potential underpayments (PUPs) in SA cases

Potential Underpayments (PUPs) are no longer coded out in SA cases. Instead they are taken into account in the SA calculation for that year.

When a PUP is calculated or amended, an explanation is printed in the bottom right hand box of form P2. This advises the taxpayer that the PUP will be coded in the following year. For examples of the text that will appear on the P2 in SA cases see PAYE14025.

Cases moving into SA before annual coding main review

If the SA signal is set on the COP record before Annual Coding Main Review takes place in early January, any CY PUP will not normally be coded out in CY+1.

Where a PUP was created before the SA signal was set, the taxpayer will have been told on the P2 that it would be coded out. You will need to advise them that the PUP will now be collected through the SA balancing payment.

Cases moving into SA after annual coding main review

If the SA signal is set on the COP record after Annual Coding Main Review has taken place in early January, any CY PUP will already have been coded out for CY+1. If the taxpayer objects, remove it from the code.

Cases moving out of SA before annual coding main review

If the SA signal is deleted from the COP record before Annual Coding Main Review, any CY PUP will be automatically coded out for CY+1.

Where a PUP was created before the SA signal was deleted, the taxpayer will have been told on form P2 that it would be collected through the SA balancing payment. You will therefore need to advise them that it will now be coded out.

Cases moving out of SA after annual coding main review

If the SA signal is deleted from the COP record after Annual Coding Main Review use Function CD for CY+1 to code out any PUP.

Where a PUP was created before the SA signal was deleted, the taxpayer will have been told that it would be collected through the SA balancing payment. You will therefore need to advise them that it will now be coded out.