PAYE50016 - Employer returns: employer payments: payments received in processing offices (Action Guide)

To take the appropriate action when you receive a payment in a processing office, follow steps 1 - 24 below. The Guide is presented as follows

Initial action Step 1
Cash payments Step 2
Cheque payments Steps 3 - 6
Cheque completed correctly Steps 7 - 8
Cheque completed incorrectly Steps 9 - 13
Type of payment received Step 14
Tax Credit debts Step 15
Payments for NICO Step 16
Tax payments / combined tax and NIC payments Step 17
Cheques of less than £250,000 Step 18
Cheques of £250,000 or more Step 19
Office with a cheque banking facility Step 20
Office without a cheque banking facility Step 21
Preparation of cheques / payslips for transmission to appropriate office Steps 22 - 24

For details of how to access any of the Employer Business Service functions use the [Index of Functions] button on the left of the screen.

Initial action

1. Review the payments and associated correspondence on the day they are received in your office 
 
  • If you have received a payment of overpaid child benefit 
 
    • If paid by cheque, send the cheque(s) and any correspondence to
 
Newcastle Banking Unit
 
Room BP5002A
 
Benton Park View
 
Longbenton
 
Newcastle Upon Tyne
 
NE98 1YX
 
    • If the customer wants to make payment in cash, ask them 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
 
  • Otherwise, for all other payments 
 
    • If there is a cash payment in sterling go to step 2
 
    • If there is a cheque payment in sterling go to step 3
 
    • If there is a payment in euro follow the guidance in Action Guide 'Payments in euro' PAYE50010 

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Cash payments

2. Cash payments are not normally 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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Cheque payments

  If you receive a cheque payable to HM Customs & Excise
 
  • Go to step 3
     
    Otherwise
 
  • Go to step 5
3. When you receive a cheque made payable to HM Customs & Excise
 
  • Telephone the Voluntary Arrangement Service (VAS) (This text has been withheld because of exemptions in the Freedom of Information Act 2000) 
 
  • Ask VAS to confirm that a Revenue debt is included in the Voluntary Arrangement
 
    • If VAS confirm that you can accept the payment go to step 4
 
    • If VAS confirm that there is no Revenue debt send the cheque and accompanying correspondence by 1st class post to
 
HM Revenue & Customs
 
VAT Controller
 
VAT Central Unit
 
BX5 5AT
4. If VAS confirm that you can accept the payment
 
  • Ask them to confirm how the payment is to be allocated
 
  • Complete a payslip(s) for the Revenue debt and include details of the C&E debt(s) on a compliment slip
 
  • Send the payment direct to Banking Operations
 
  • Do not bank the payment locally
5. When you receive a cheque you must establish whether there is a payslip
 
  • If the cheque is accompanied by a fully completed payslip go to step 7
     
    Otherwise
 
  • Go to step 6
6. If there is no payslip or the payslip you have received is incomplete you must prepare a payslip. To do this you should
 
  • Prepare a pro-forma payslip using the Print Payslip (PP) application where payment is to be sent to Banking Operations
     
    Or where the payment is being sent elsewhere
 
  • Complete a clerical payslip using form PS1 or AZ813(new). This must include
 
    • The employer’s name
 
    • Amount paid
 
    • Effective date of payment
 
    • Full Debt Management office reference
 
    • If the employer has requested a receipt an ‘R’ in the receipt required box
 
  • Date stamp the payslip on the reverse with your local office stamp

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Cheque completed correctly

7. You must ensure that any cheque received has been completed correctly. It should be
 
  • Payable to HM Revenue & Customs or a similar designation (for example, ‘HMRC’, ‘Inland Revenue’ ‘Collector of Taxes’, or ‘HMIT’)
 
  • In-date for presentation, that is dated not more than six months earlier than the date it will be presented for payment
 
  • Completed to show the same amount in both words and figures
 
  • Signed with any alterations also signed or initialled
 
  • Additionally, to be acceptable for bringing to account locally a cheque must be made out in sterling and drawn on a bank in the United Kingdom (including Isle Of Man, Jersey and Guernsey)
8. If the cheque has been completed correctly
 
  • Go to step 14
     
    Otherwise
 
  • Go to step 9

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Cheque completed incorrectly

9. If a cheque has not been completed correctly your next action will depend on the type of error or omission
 
  • For ‘No Payee’ go to step 10
 
  • For an ‘Incorrect Payee’ go to step 11
 
  • For a ‘Post-dated cheque’ go to step 12
10. If there is no payee
 
  • Where there is no doubt that the payment is for HMRC impress the INLAND REVENUE ONLY stamp on the payee line and treat as normal
     
    And then
 
  • Go to step 14
11. Where the payee is incorrect
 
  • Return the cheque irrespective of the amount
12. For a post dated cheque, if your office has suitable security arrangements to store the post dated cheque you must 
 
  • Consider if the post dated cheque is acceptable
 
  • Retain the post dated cheque until three working days before it’s date 
     
    And at that date
 
  • Send the post-dated cheque to Banking Operations with any pro-forma payslip required for processing
     
    And then
 
  • Go to step 24
13. If your office does not have suitable security arrangements to store the post dated cheque you should on the day of receipt of the payment go to step 24

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Type of payment received

14. Your next action will depend on the type of payment received. If it is
 
  • A debt relating to tax credits go to step 15
 
  • Class 2 and / or 3 NIC go to step 16
 
  • A payment of tax (including Class 1 / 1A and Class 4 NIC) go to step 17
 
  • A combined payment of tax (including Class 1 / 1A and Class 4 NIC) and Class 2 and / or 3 NIC to step 17

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Tax Credit debts

15. Payment by cheque or postal order should be sent to the TCO as follows
 
  • For Great Britain
 

CBO / TBO Great Britain
 

HMRC
 

PO BOX 145
 

Preston
 

PR1 0GP
 
  • For Northern Ireland
 

CBO / TBO Northern Ireland
 

HMRC
 

Dorchester House
 

52-58 Great Victoria Street
 

Belfast
 

BT2 7WF
  You must attach the application for payment or a photocopy to each cheque or postal order sent to the TCO

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Payments for NICO

16. The cheque should be sent to NICO at the following address
 

HMRC NI Contributions Office
 

Central Banking Services
 

Room BP5002 A2
 

Longbenton
 

NE98 1ZZ
  You must pass correspondence to any NICO staff co-located in your office or send it with the cheque

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Tax payments / combined tax and NIC payments

17. Your next action will depend on the amount of the payment received. If this is for
 
  • Less than £250,000 go to step 18
 
  • £250,000 or more go to step 19

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Cheques of less than £250,000

18. For cheques of less than £250,000
 
  • For tax payments
 
    • Send the cheque to Banking Operations with a completed payslip
 
  • For a combined tax and Class 2 and / or 3 NIC payment
 
    • Prepare separate payslips for tax and NIC
 
    • Send the cheque with the completed payslips to Banking Operations
 
And then
 
  • Go to step 23

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Cheques of £250,000 or more

19. For payments of £250,000 or more
 
  • If your office has a cheque banking facility go to step 20
     
    Or
 
  • If your office does not have a cheque banking facility go to step 21

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Office with a cheque banking facility

20. If your office has a cheque banking facility
 
  • For payments of between £250,000 to £3 million
 
    • Bank the cheque locally using summary bank facilities whenever possible
 
  • For payments of between £3 million to £100 million
 
    • If same day lodgement can be arranged bank the cheque locally using summary bank facilities
 
Or
 
    • If it is too late in the day for same day lodgement and your office and the bank are open the next day retain the cheque and bank it using summary bank facilities the next day
 
Or
 
    • If your office and / or bank is closed the next day telephone DMB Banking for advice (This text has been withheld because of exemptions in the Freedom of Information Act 2000) 
 
  • For payments of £100 million or more
 
    • Telephone DMB Banking for advice (This text has been withheld because of exemptions in the Freedom of Information Act 2000) 

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Office without a cheque banking facility

21. If your office does not have a cheque banking facility
 
  • For payments of more than £250,000 to £100 million
 
    • You should take the cheque to the nearest office with a cheque banking facility with a completed payslip
 
Or
 
    • If this is impractical pay the cheque into a Banking Operations account at any high street bank using the bank giro system. You will need a correctly completed payslip of the PS1 series
 
    • If the bank makes a charge for using the bank giro service this should be reimbursed from petty cash
 
  • For payments of £100 million or more
 
    • Telephone DMB Banking for advice (This text has been withheld because of exemptions in the Freedom of Information Act 2000) 

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Preparation of cheques / payslips for transmission to appropriate office

22. Your next action will depend on the type of cheque to be sent
 
  • For post-dated cheques and accompanying payslips go to step 24
  Otherwise
23. To prepare cheques and / or payslips for transmission to the appropriate office you should
 
  • Remove all payslip counterfoils
 
  • Remove all paper clips, pins and staples
 
  • Stamp the reverse of the payslip in the top right hand corner with the local office name
 
  • Bundle the payments together by placing them in the order of payslip on top of the cheque to which it relates. The order of the bundle should therefore be payslip, cheque, payslip, cheque and so on
 
    • The bundles should be of reasonable size
 
    • Do not attach the payslip and cheque together in any way
 
  • Count the number of cheques per bundle and note the total (per bundle) on an office compliment slip. Place the slip on the top of the payslips / cheques
 
  • Fasten the bundle of payslips / cheques for the day securely with a rubber band
 
  • Send the bundle to the appropriate office
24. For post-dated cheques you should
 
  • Remove all payslip counterfoils
 
  • Remove all paper clips, pins and staples
 
  • Stamp the reverse of the payslip in the top right hand corner with the local office name
 
  • Bundle the payments together by placing them in the order of payslip on top of the cheque to which it relates. The order of the bundle should therefore be payslip, cheque, payslip, cheque and so on
 
    • The bundles should be of reasonable size
 
    • Do not attach the payslip and cheque together in any way
 
  • Count the number of cheques per bundle and note the total (per bundle) on an office compliment slip
 
  • Note the office compliment slip prominently in red ‘POST-DATED cheques’
 
  • Place the slip on the top of the payslips / cheques
 
  • Fasten the bundle of payslips / cheques for the day securely with a rubber band
 
  • Send the bundle to the appropriate office

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