PAYE90031 - taxpayer end of year: taxpayer underpayments: remission of tax (Action Guide)


When considering remissions follow steps 1 - 33 below. This guide is presented as follows

RemissionSteps 1 - 9
Review of remission request and capital resources (Officer duties)Steps 10 - 16
Review of remissions (Higher Officer duties)Steps 17 - 18
Security checks (Higher Officer duties)Steps 19 - 24
Form P75RLSteps 25 - 30
Cancel a remission of an underpaymentSteps 31 - 33


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

Remission

  1. Where the underpayment cannot be collected by any other means you should pass the papers to an experienced officer to consider remitting the underpayment

  2. If remission is agreed

  • Record details of the case on the appropriate establishment file list
  • Record the remission of the underpayment
  • Use ENOTE ‘Remission of underpayment’ from the SEES notes paster to record that remission has been agreed
  1. If remission is not agreed

  • Carry out any further checks that the Officer has asked that you make
  • Once you have carried out any further checks requested by the Officer pass the papers back to the Officer with the additional information / findings
  • If the underpayment is to be collected and exceeds £2,000 or is a stranded underpayment go to step 4
  • If the underpayment is to be collected and can be collected through the taxpayer’s tax code
  • Include the amount in the tax code for the next full tax year
  • Write to the taxpayer / agent explaining your action
  • Use ENOTE ‘Remission of underpayment’ from the SEES notes paster to record that remission has not been agreed and to note that the amount is to be collected through the coding
  1. Send a ‘Direct Voluntary Payment’ letter – available in SEES Forms and Letters - to the taxpayer / agent, explaining why it is not possible to collect the underpayment through PAYE and asking for a voluntary payment to settle the liability

  • Follow steps 1 – 2 in PAYE90011 (‘Issue A Payslip For Payment Of Tax’) - to send a payslip with the letter
  • Use ENOTE ‘Remission of underpayment’ from the SEES notes paster to record that remission has not been agreed and that a request for a direct voluntary payment has been issued together with a payslip
  1. If the underpayment is for CY-1, keep the papers on BF until either 31 January or 6 weeks after the issue of your letter, whichever is the later

  2. If the underpayment is for CY-2 or earlier, keep the papers on BF until 6 weeks after the issue of your letter

  3. If you have received a form P211(Z) / P209 acknowledging receipt of only part payment of the underpayment

  • Follow steps 3 - 21 in PAYE90011 to deal with the form P211(Z) / P209, before taking the following action
  • If the balance of tax unpaid is less than £2,000
  • Include the balance in the coding
  • Record the payment of tax
  • Use ENOTE ‘Voluntary payment received in part’ from the SEES notes paster to record that part payment has been received and to also note that the balance of the underpayment will be collected through the coding
  • Write to the taxpayer / agent acknowledging receipt of the payment and explain the balance of the underpayment will be collected in the tax code and in which tax year
  • If the balance of tax unpaid exceeds £2,000 or more and you are part of an integrated COP / SA team, set up an SA record (or re-open any dormant SA record) for one year only and issue an income tax return for the year in question, following the instructions in the ‘Records’ business area of the SA Manual
  • Use SEES notes paster to make the ENOTE ‘Underpayment Exceeds £2000’,and the SA note ‘SA return sent to’ to record the SA reference and that an SA tax return has been issued
  • If the entry appears on the list of stranded underpayments note the entry ‘SA return issued [date]’
  • If the balance of tax unpaid is £2,000 or more and you are not part of an integrated COP / SA team
  • Report the underpayment to the SA team using the stock memo ‘COP underpayment to SA’ on LFC
  • Use SEES notes paster to make the ENOTE ‘Underpayment referred to SA' to note that an SA return has been issued
  • Write to the taxpayer / agent explaining your actions and that the SA return will be issued shortly
  • Keep the case on BF until the SA team confirm the SA reference and issue of the income tax return
  1. If you have received a form P211(Z) acknowledging receipt of payment in full of the underpayment

  • Follow steps 3 - 21 in PAYE90011 to deal with the form P211(Z) / P209, before taking the following action
  • Record the payment of tax
  • Use ENOTE ‘Voluntary payment received’ from the SEES notes paster to record your actions and collection reference number, and dispose of the form
  • Write to the taxpayer / agent confirming receipt of payment in full of the underpayment of tax
  1. If you have not received a form P211(Z) acknowledging receipt of the payment by the appropriate BF date

  • If you are part of an integrated COP / SA team set up an SA record (or re-open any dormant SA record) for one year only and issue an income tax return for the year in question, following the instructions in the ‘Records’ business area of the SA Manual
  • Use SEES notes paster to make the ENOTE ‘Underpayment Exceeds £2000’,and the SA note ‘SA return sent to’ to record the SA reference and that an SA tax return has been issued
  • If the entry appears on the list of stranded underpayments note the entry ‘SA return issued [date]’
  • If you are not part of an integrated COP / SA team report the underpayment to the SA team using the stock memo ‘COP underpayment to SA’ on LFC
  • Use SEES notes paster to make the ENOTE ‘Underpayment referred to SA' to note that an SA return has been issued
  • Keep the case on BF until the SA team confirm the SA reference and issue of the income tax return

Review of remission request and capital resources (Officer duties)

The following duties must be carried out by an Officer.

To carry out the Officer duties required when you receive a request to remit an underpayment, consider steps 10 - 16


  1. If the underpayment is less than £1,250, or less than £400 if it is a Revenue Delay ESC A19 case

  • Review the papers provided by the Administrative Assistant / Officer and the checks that they have made to verify that the underpayment cannot be collected in any way
  • If you agree that the underpayment should be remitted return the papers to the Administrative Assistant / Officer with a note authorising this, including your name and the date
  • If you do not agree that the underpayment should be remitted return the papers to the Administrative Assistant / Officer stating your reasons and what further action is required, including your name and date
  1. If the underpayment is £1,250 or more, or in a Revenue Delay Case (ESC A19) £400 or more

  • Review the papers provided by the Administrative Assistant / Officer and the checks that they have made to verify that the underpayment cannot be collected in any way
  • If the appropriate checks have not been made or are not correct, return the papers to the Administrative Assistant / Officer explaining why you do not agree that the underpayment should be remitted, to follow steps 3 - 9 in this action guide
  1. If the underpayment is £1,250 or more also consider whether the taxpayer has assets, which could be used to settle the underpayment. This information can be obtained on request from your local Area Risk Intelligence and Analysis Team (RIAT), for example

  • Funds in a bank, building society or similar account
  • Property which might be used as security for a loan or possibly sold
  • Other investments

Where the taxpayer’s home is the only asset, you should normally support remission when referring the case to the Higher Officer at step 14

  1. If you decide that sufficient assets are available or more information is needed

  • Return the papers to the Administrative Assistant / Officer explaining why you do not agree that the repayment should be remitted, to follow steps 3 - 9 in this action guide
  1. If you decide that there are insufficient assets available (if appropriate) and the underpayment should be remitted

  • Refer the papers to the appropriate Higher Officer for authorisation
  1. If the Higher Officer authorises remission

  • Return the papers and authorisation back to the Administrative Assistant / Officer to carry out step 2 in this action guide
  1. If the Higher Officer does not authorise remission

  • Return the papers to the Administrative Assistant / Officer explaining why the repayment should not be remitted, to follow steps 3 - 9 in this action guide

Review of remissions (Higher Officer duties)

The following duties must be carried out by a Higher Officer.

Remissions will be passed to you for authorisation from the Officer, once they have made their own checks


  1. On receipt of a remission request and papers

  • Review the papers and checks made by the Administrative Assistant / Officer to confirm that the taxpayer’s ability to meet the underpayment has been fully considered
  • Consider the taxpayer’s ability to meet the underpayment and the enquiries undertaken by the Officer regarding capital resources
  1. Following your review

  • If you authorise remission - mark the papers ‘authorised [name] [date]’ and return the papers to the Officer
  • If you do not authorise remission - return the papers to the Officer with an explanation of why you cannot agree remission, who will refer the papers back to the Administrative Assistant / Officer to follow steps 3 - 9 in this action guide

Security checks (Higher Officer duties)

The following duties must be carried out by a Higher Officer.

A nominated Higher Officer, not previously involved with remission orders, should check all working papers for a random sample of remissions made during the account. The sample size depends on the total number of remissions to be checked. Minus entries should be ignored


1 remission - check it

2 - 29 remissions - check 2

30 or more remissions - check 10 per cent

  1. Use COP Function TI and Taxpayer Business Service (TBS) to check if the record has been transferred to another office

  • If the records have not been transferred go to step 20
  • If the records have been transferred
  • Send an e-form - standard 41A to the new office addressed to the Area Director / Senior Location Manager
  • Detail all the listed information about the remission
  • Ask that a nominated Higher Officer check the remission in accordance with this action guide

The Higher Officer performing the check in the new office must

  • Confirm in a signed e-form – standard 41A to the previous office that the check indicates the remission is correctly recorded

Or

  • Report any discrepancy to the Area Director / Senior Location Manager in the previous office and attach the papers if there are any
  1. Check all the working papers for each sample case

  2. Confirm that

  • Class of remission shown is correct
  • Remission is authorised at the appropriate grade
  • Remission is correctly entered on the taxpayer’s record
  1. If there are any grounds for suspecting irregularities

  • Immediately make a report in duplicate to the Personnel Unit dealing with conduct and discipline matters at the relevant Area Office / Large Processing Office
  • Send a copy of the report to the appropriate Area Director / Senior Location Manager
  • If the record cannot be traced, send a report in duplicate to the appropriate Area Director / Senior Location Manager immediately
  1. When you are satisfied with the remissions in the sample, initial and date your office’s file copy of the list for the cases in the sample

  2. Once the security check is complete, pass the records to the appropriate Officer to send form P75RL to the appropriate Area Office / Large Processing Office

Form P75RL

The following duties must be carried out by an Administrative Assistant


  1. At the end of the account, list the underpayments for each establishment file list other than those

  • To be included in the separate report made of underpayments covered by the Revenue Delay provisions of ESC A19 (EP6600+)
  1. Prepare lists of remissions as follows

  • Total the amounts for each class of remission
  • Enter on each list any MINUS remissions you have for that same class of remission and total the amounts
  • Subtract the total of any MINUS remissions from the total of amounts remitted. Write ‘NET TOTAL’ at the bottom of the list and enter alongside the net total of amounts remitted
  1. Pass the establishment file and lists to the Officer

The following duties must be carried out by the Officer responsible for the office’s balance.

Copies of form P75RL are supplied annually, in time for the report to be made.


  1. Complete the boxes on the form P75RL from the totals shown for each class on the lists prepared. If there are no remissions write NIL prominently across the boxes

  2. Retain the office copy in the appropriate establishment file together with the lists of cases

  3. Send the completed form P75RL no later than the third Friday in November to the Debt Management Group Manager that deals with your Area / Large Processing Office

Cancel a remission of an underpayment

An underpayment that has been remitted may subsequently become recoverable. For example, a new address may become available after an underpayment was remitted because an address was noted RLS.

To carry out the following Assistant Officer duties required consider steps 31 - 33


  1. Use the appropriate establishment file to check if the underpayment was remitted in your office

  • If the underpayment was not remitted in your office, identify the office that remitted the underpayment and send an e-form - standard 41A to the main office now dealing with the taxpayer’s affairs telling them to cancel the entry in Function CS and to report the underpayment to SA / collect through the tax code
  • If the underpayment was remitted in your office go to step 32
  1. Use TBS to check if the taxpayer’s affairs are still dealt with in your office

  • If the taxpayer’s affairs are no longer dealt with in your office, send an e- form - standard 41A to the present main office telling them to cancel the entry in Function CS and to report the underpayment to SA / collect through the tax code
  • If the taxpayer’s affairs are still dealt with in your office
  • Cancel the record of remission
  • Go to step 33
  1. From the record in the appropriate establishment file list, determine the remitted amount and use COP Function TD and TI and the Taxpayer Business Service (TBS) to check if the taxpayer has a current source of income

  • If the remitted tax is less than £2,000
  • Include the amount not remitted in the tax code
  • Write to the agent / taxpayer explaining that the tax is now due and payable and that it will be collected through the tax code
  • If the remitted tax is £2,000 or more follow steps 4 - 9 above, including an explanation in the ‘free text’ paragraph of the stock letter to the taxpayer / agent why the tax has now become due and payable

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