PAYE14040 - coding: coding functions: function CD: format 1


PAYE14055 tells you what entries to make in the fields on this screen.

After pressing Enter, correct any errors shown on the screen. The error message may relate to next year even though items were entered for this year. If so, use the suspend facility to go to the details for next year. Correct the error using Function CD for the current year.

The remainder of this subject is presented as follows

Format 1 redisplayed

Checks and action

Coding allowances exceed five digits

How to get Format 2

WK1.MTH1 and NOT OP fields

P2? field

P6? field

P6 PAY and TAX fields

NEXT field

Format 1 redisplayed

When you press Enter and there are no errors (or any errors have been corrected), Format 1 will be redisplayed with amended details if entries were made in any of the following fields

  • WK1/MTH1
  • NOT OP
  • ALLCES
  • DEDNS
  • SIGS ETC
  • CODE

It shows

  • Details of the current code in the CODE ISSUED column
  • Details of any revised code in the REVISED column, including
    • The basis on which the code operates
    • Any potential underpayment arising
  • Details of the latest signals in the area above name and address
  • Entries in the P2? and P6? fields, showing whether these forms are to be issued

Checks and action

Check

  • The revised coding details
  • The basis on which the code operates
  • Entries in the P2? and P6? fields

If no further amendment is necessary

  • Enter Y in the OK? Field

And

  • Press Enter

If you only need to make an amendment in the P2? and / or P6? field

  • Amend as necessary
  • Enter Y in the OK? Field

And

  • Press Enter

If other amendments are necessary

However, if there is an entry in the WK1/MTH1 or NOT OP field, make no amendment or entry in the P2? or P6? fields until you

  • Make the other amendments (if required)

And

  • Press Enter

Format 1 will be redisplayed showing the effect the further amendments have made. You can now consider entries in the P2? and P6? fields.

Coding allowances exceed five digits

The computer uses only the final five digits of net coding allowances to calculate the code. Therefore, if the net coding allowances exceed five digits

  • Code the case manually
  • Set the MCODE signal

And

  • Enter as the reason (NCA99999+)

How to get Format 2

To get Format 2

  • Enter ‘Y’ in Format 2? field
  • Press Enter

You cannot enter ‘Y’ if

  • P2? field shows ‘Y’

Or

  • OK? field shows ‘Y’

WK1.MTH1 and NOT OP fields

The following tables tell you what entries you may need to make when the coding screen is redisplayed after amendment.

There may be cases where you want to change the basis given by the computer. Any entries here depend on the nature of the case, the type of code allocated by the computer and the action you wish to take.

SituationAction
Computer allocates a Week 1 code and you wish to change it to cumulative
  • Enter N in the WK1/MTH1 field. Any potential underpayment will disappear when you press Enter. If you decide to reinstate the Week 1 basis, the computer will not recalculate the potential underpayment
  • If necessary, recalculate the potential underpayment and enter the figure in the DEDNS field using PUP
Computer allocates a Week 1 code and you wish to keep the code but not operate it
  • Enter Y in the NOT OP field
  • Check any potential underpayment. The computer only calculates the underpayment up to the date of change. If NOT OP is applied the potential underpayment needs to relate to the full year
  • If necessary, recalculate the potential underpayment and enter the new figure in the DEDNS field using PUP
Computer allocates Week 1 and ‘not operated' basis and you wish to cancel 'not operated'
  • Enter N in the NOT OP field
  • Check any potential underpayment. The potential underpayment may relate to the full year. If NOT OP is cancelled the underpayment must only relate to the period up to the date of change
  • If necessary, recalculate the potential underpayment and enter the new figure in the DEDNS field using PUP
Computer allocates Week 1 and ‘not operated' basis and you wish to cancel 'not operated' and change to cumulative
  • Enter N in the NOT OP field
  • Enter N in the WK1/MTH1 field
  • Press Enter. Any potential underpayment will disappear
The computer continues the existing basis because it holds insufficient information to revise (no last cumulative or operated code for instance)
  • Check the code basis. Otherwise, the existing one will continue
  • If restoring cumulative basis by entering N in the WK1/MTH1 field, consider whether pay and tax details need to be included on the P6
  • Check any potential underpayment arising. Amend only where more information is available
Jobseekers Allowance casesNo action is needed for main source. Revised codes are always operated on a cumulative basis regardless of any reduction in code. For a sub source
  • Enter ‘Y’ in the WK1/MTH1 field
Code 0T in the code fieldThe computer allocates WK1/MTH1 basis, shown as 0T WK1.
  • Enter N in the WK1/MTH1 filed if this is not correct
  • Press Enter for a further display


P2? field

SituationAction
P2? field entry is ‘Y’.
  • A form P2 is to be issued and there is a change in any of the following
    • Net coding allowances
    • Code
    • Code basis
    • Code suffix
    • Potential underpayment arising
  • The form P2 is to be prepared and issued manually
  • Enter M
  • Prepare and issue the form P2 manually
P2? field entry is ‘N’.

There is no change to the code or other items.		No action required
P2? field entry is ‘N’.

A duplicate P2 is needed.
  • Change the P2? field entry from ‘N’ to ‘Y’
P2? field entry is ‘N’.

There is a change to next year's coding before Annual Coding.		No action required
P2? field entry is ‘N’.

A current year code is changed after 13 March.		See PAYE14020
P2? field entry is ‘M’.

M appears because there has been a change of code and the RLS signal is present.		If you do not have a later address
  • Send the manual P2 c/o the employer. Ask for the latest private address on form MS120

Or where the screen shows the UN-BEN signal

  • Ask the Benefit Office for the latest address

If you have a later address

  • Use TBS Function AMEND TAXPAYER DESIGNATORY DETAILS to change the address
  • When the address change has passed to the COP record, change the P2? field entry from ‘M’ to ‘Y’
P2? field entry is ‘M’.

M appears because there has been a change of code and the MCOTP signal is present.
  • Consider why the signal was set and whether or not it is still necessary

If so Prepare and issue the P2 form manually If not

And

  • Change the field entry from ‘M’ to ‘Y’
P2? field entry is ‘M’.

M appears because there has been a change of code and there are too many entries to fit on the P2.
  • Prepare and issue the form P2 manually
P2? field entry is ‘M’.

M appears because there has been a change of code and the code is NT or FT.
  • Prepare and issue the form P2 manually
  • Do not issue code FT if the taxpayer is currently a Jobseekers Allowance claimant


P6? field

SituationAction
P6? field entry is ‘Y’. A form P6 is to be issued by the computer and there is a change in
  • The code
  • The code basis
  • The code suffix
No action required
P6? field entry is ‘Y’.

The code is already operated by the employer, for example, classes 1 or 3 on form P46.
  • Change the entry to ‘N’
P6? field entry is ‘Y’.

It is known to be too late in the year for the employer to operate the code.
  • Change the entry to ‘N’
P6? field entry is ‘N’.

There is no change to the code.		No action required
P6? field entry is ‘N’.

A duplicate P6 is needed.
  • Change the entry to ‘Y’
P6? field entry is ‘N’.

There is a change to next year's coding before Annual Coding.		No action required.
P6? field entry is ‘N’.

It is too late in the year for the employer to operate the new code.		See PAYE14020
P6? field entry is ‘N’.

The code is not to operate.		No action required.
P6? field entry is ‘N’.

There has been a change to the code and other items, but there is no current employment or Jobseekers Allowance claim.		No action required
P6? field entry is ‘M’.

M appears if there has been a change of code and the MCOEMP signal is present
  • Consider why the signal was set and whether or not it is still necessary

If so

  • Prepare and issue the P6 form manually

If not

And

  • Change the field entry from ‘M’ to ‘Y’
P6? field entry is ‘M’.

FT has been entered in the CODE field for the current year.
  • Prepare and issue the form P6 manually
  • Follow the advice about agricultural workers in PAYE23025


If you change a code for next year and the computer has issued forms P9 or code lists

Issue form P9 to an employer (manual issue) Issue form P6U to the Benefit Office as usual The Annual Coding Business Guidance Note (BGN) gives you the exact dates each year.

Do not enter a temporary reference number on forms P6 or P9. If necessary, leave the space blank.

P6 PAY and TAX fields

SituationAction
Nil Pay or Tax to be included on the form P6.
  • Enter 0 or 0.00, as appropriate
Pay or Tax exceeds £84,000 in a Jobseekers Allowance case.
  • Prepare and issue the form P6U manually
Any other Pay and Tax figure to be included on the P6.
  • Enter the figures in these fields
Issue of duplicate P6 required with pay and tax figures.
  • Enter ‘M’ in the P2? Field
  • Enter ‘Y’ in the P6? Field
  • Re-enter the pay and tax details in these fields
No figure needed.
  • Leave these fields blank


NEXT field

SituationAction
Changes made after Annual Coding which affect both this year and next year.
  • Use Function CD for both years. The change for next year will otherwise not take place
Annual Code issue already made but form P6 issued for this year.
  • Issue a P9 for next year, even where there is no change to the code for that year, so that the employer has an up to date code
The only error relates to this field.Prime Format will be displayed with the relevant error message. See PAYE14035

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