PAYE95035 - Taxpayer end of year: HMRC delay: ESC A19: underpayments - treat each year separately

For the purposes of ESC A19 each year is discrete and independent of any other year. An underpayment given up should not be restricted by an overpayment from another year.

Any such overpayment should be repaid or set off against an underpayment to which ESC A19 does not apply.

Example

The three years 2004-2005 to 2006-2007 are uncleared.

After review the position is:

• 2004-2005 - Tax overpaid £100.
• 2005-2006 - Tax underpaid £400 but is given up under ESC A19 and not carried forward to 2006-2007.
• 2006-2007- Tax underpaid £300 - ESC A19 does not apply.

The underpayment of £400 for 2005-2006 is given up and recorded in the ESC A19 Office Record PAYE95105.

The overpayment for 2004-2005 is carried forward to 2006-2007, reducing the recoverable tax to £200. If there was no underpayment in 2006-2007 the tax overpaid of £100, plus any supplement, would be repaid to the taxpayer.