PAYE76087 - PAYE operation: pensioners: work item 136 - first year NIB (Action Guide)

Initial action in all cases

Step 1

Update record

Steps 2 - 10

Close the work item

Steps 11 - 12

1.

Review

• The individual’s record on the PAYE Service

• Indicators set on the record

• Any relevant notes

2.

Check if form P161 received

• If form P161 held

• Check that latest details are held on the income, allowances, benefits and deductions (IABD) (including details of state pension / benefits) or enter details, refer to PAYE130065 for state pension

• In cases where state pension has been deferred, close work item 136 and follow guidance at PAYE76125 

• In cases where incapacity benefit has been paid up to and including the day before state pension / benefits commences you must apportion the incapacity benefit and enter the actual incapacity benefit and actual state pension / benefits. Where the net coding allowances are increased, issue the code on a cumulative basis

3.

On the Code Details screen ‘Submit’ to issue the tax code

4.

Update Contact History and go to step 11

5.

If form P161 not held - Check Contact History (last 3 months) for notes about last details of income

Note: If the Employment Details or Contact History show that the customers last employment was in CY-1 or earlier only estimate the basic state pension from the P242

6.

Update the income, allowances, benefits and deductions pages with details of the state pension / benefit details (if details are not held - estimate the amount using the basic state pension on form P242).

In cases where incapacity benefit has been paid up to and including the day before state pension / benefits commences you must apportion the incapacity benefit and enter the actual incapacity benefit and actual state pension / benefits. Where the net coding allowances are increased, issue the code on a cumulative basis

For information about how to enter details and submit for a code calculation refer to PAYE130020 

(Age-related allowances are not due when the P161 has not been received unless full details of the individual’s income are already known. Once a P161 is logged as received the system will calculate the age-related allowances due using the income details entered in the income, allowances, benefits and deductions pages).

7.

Add a note on Contact History ’Full details of income not known, P161 issued’. Issue form P161 to get the up-to-date income details. For more information about issuing a form P161 refer to PAYE79042 

Note: Where the primary employment is an occupational pension that commenced in CY any EXP, FRE or PSUB included in the CY code will automatically be reduced to nil for CY+1 in the Annual Coding run, so there is no need to review that aspect when dealing with this work item.

8.

On the Code Details screen ‘Submit’ to issue the tax code. For details about how the system calculates the amount of state pension / benefit to be coded refer to PAYE76086 

Note: If the existing amount is annual and the system generated code increases the net coding allowances and you are changing the basis of operation from week 1 / month 1 to cumulative on the Employments Allocation screen, [Cancel] the Code Details screen and in IABD Pensions page (PAYE130065)

• Delete the start date in the Pensions details page

• Select ‘Annually’

• Enter the actual amount

• [Save] and [Submit]

• Change the basis of operation from week 1 / month 1 to cumulative on the Employments Allocation screen

9.

Complete and issue form P173 (PAYE76100 refers)

10.

Update Contact History and go to step 12

11.

Complete the work item notes

12.

Close the work item