PAYE50015 - Employer returns: employer payments: payments received in processing offices

This subject is presented as follows

Payments general
Cheque payments
Cash payments
Missing payments
Tax payments to Banking Operations
NICO payments
Tax Credit debts
Voluntary arrangements
(This text has been withheld because of exemptions in the Freedom of Information Act 2000)

Payments general

An employer or contractor may send a payment to the responsible processing office attached to correspondence or with their returns. This could include any of the following

• Tax including Class1 / 1A and Class 4 NIC
• NIC Class 2 and / or Class 3
• Student Loan Deductions
• Debts in respect of tax credits

All payments must be dealt with on the day of receipt and extra care should be taken when handling cash payments. All cash payments and payments received in the post by either Registered / Recorded / Special Delivery or Special Remittances must be entered into the Book 23.

From 3 March 2006 cash payments will not normally be handled in processing offices. Customers should be directed to take their payment to a Post Office or pay at their own bank branch. You should check that the customer has the appropriate payslip to accompany the payment.

You can suggest to payers that there are other options, which include

• Paying in cash at the Post Office. Use the Print Payslip (PP) application to provide the employer with a printed payslip to use, if one is not already held
• Payment by electronic funds transfer, for example

• • BACS / CHAPS (payment by credit transfer)
  • Online or telephone banking

• • Over the counter at a bank or Post Office by Bank Giro (payment at a bank) or Girobank (payment at a Post Office)

Copies of payment fact sheets that describe the various other ways in which payments can be made are available on the Payment and Banking Intranet site under Customer Help Sheets. You should print these locally and hand a copy to each cash-paying taxpayer.

DMB Banking, (This text has been withheld because of exemptions in the Freedom of Information Act 2000) provide payment advice for any queries you are unable to handle.

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Cheque payments

The action you must take depends on

• Whether or not your office has a cheque banking facility
• The value of the cheque received
• The type of payment received

More guidance is available at PAYE50015.

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Cash payments

From 3 March 2006 cash payments will not normally be handled in Processing Offices. Customers should be directed to take their payment to a Post Office or pay at their own bank branch. You should check that the customer has the appropriate payslip to accompany the payment.

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Missing payments

You may have received correspondence suggesting that a payment is enclosed. This could be

• A completed payslip on its own
• A letter containing a reference to a payment but no payment is enclosed
• A request for a receipt but no payment is enclosed

You must make urgent contact with the employer to locate any missing payment.

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Tax payments to Banking Operations

When you receive a payment of tax including Class 1 / 1A and Class 4 NIC you should

• Prepare a pro-forma payslip using the Print Payslip (PP) application

• Transmit the payment to Banking Operations

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NICO payments

Payment by cheque of Class 2 or Class 3 NIC should be directed to NICO for them to bank. If a payer proposes to make a combined Tax and Class 2 and / or a Class 3 NIC payment by cheque you should ask the payer for 2 separate cheques if possible.

Where there is a cash payment or a combined payment (cash or cheque) you must

• Not refuse the payment

• Follow the guidance contained in this subject appropriate to the payment type received

The NICO address is

HMRC NI Contributions Office
Central Banking Services
Room BP5002 A2
Longbenton NE98 1ZZ

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Tax Credit debts

Payment by cheque or postal order for a tax credit debt must be sent to the Tax Credit Office as follows

• For England, Scotland or Wales

• For Northern Ireland

Where the payment is in cash you should not refuse the payment but you must follow the appropriate guidance contained in this section.

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Voluntary arrangements

HMRC Finance has arranged for an indemnity to be put in place with the banks which will allow us to accept cheques made payable to HM Customs & Excise. You must only bank these cheques if there is a Revenue debt.

More guidance is available at PAYE50015.

• (This text has been withheld because of exemptions in the Freedom of Information Act 2000)