PAYE62021 - employment maintenance: employment changes: tax discrepancy at previous employment (Action Guide)


To deal with a form P45(3) if there is an entry at item 13, follow steps 1 - 11 below. The guide is presented as follows

Initial actionStep 1
Action in new Processing Office by the appropriate officerSteps 2 - 4
Action in old Processing Office by the appropriate officerSteps 5 - 6
Final action in new Processing Office by the appropriate officerSteps 7 - 11


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

Initial action

  1. If you receive a P45(3) with an entry at item 13
  • Use Function MA to capture the details of the new employment
  • Pass the form to an appropriate officer to review

Action in new Processing Office by the appropriate officer

  1. Use Function NO to check for an Essential Note (E Note) made by the previous Processing Office
  2. If there is not an E Note and enquiries are not already in progress
  • Send E-Form – Standard Form 41A to send details of the figures at items 7 and 13 of Form P45(3) to the previous Processing Office
  • Use Function TA to set the BF signal

And

  • File the papers in accordance with your normal office practice
  1. If there is an E Note which indicates enquiries are already in progress
  • Use Function TA to set the BF signal if it is not already set

And

  • File the papers in accordance with your normal office practice

Action in old Processing Office by the appropriate officer

  1. When you receive a request from another office to investigate a tax discrepancy
  • Telephone your employer for an explanation
  1. When an explanation is received
  • Report to your manager any cases involving an underpayment where the employer has not acted in good faith or has been persistently negligent. Your manager will then consider passing the case to the Employer Compliance Team to consider for compliance reviews
  • If necessary, correct the form P45(1) to show the pay and tax deducted by the employer
  • Send E-Form – Standard Form 41A to send the correct P45(1) details to the new Processing Office and confirm the amount of any underpayment or overpayment of tax

Final action in new Processing Office by the appropriate officer

  1. If the employer made a mistake in deducting tax which has resulted in an over or underpayment
  • Use Function CD to
  • Issue form P6 to the employer showing the tax paid as the amount actually deducted by the old employer. The overpayment will then be refunded or the underpayment recovered on the next pay day

Note: If there was an underpayment, which would lead to an excessive deduction on the next pay day, or if the taxpayer or employer complains

  • Use Function CD to change the code to a Week1 / Month 1 basis
  1. If tax was correctly deducted but the employer made a mistake in completing the P45(1)
  • Compare the pay and tax details used by the new employer with the corrected P45(1) details
  1. If they differ
  • Use Function CD to
  • Issue form P6 showing the correct pay and tax details

Note: If these figures are likely to lead to an excessive deduction of tax on the next pay day

  • Use Function CD to change the code to a Week1 / Month 1 basis
  1. If the taxpayer or employer complains
  • Use Function CD to change the code to a Week1 / Month 1 basis
  • Use Function TA to
  • Set the DR signal

And

  • Remove the BF signal
  1. File the reply from the old Processing Office in the District Record

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