PAYE95050 - Reconcile individual: HMRC delay: ESC A19: when was information received from the taxpayer?
You should confirm when information was received from the taxpayer and when HMRC should have acted on it
- Make a note of the key date the information was received
- Calculate the cut off date by which time HMRC should have sent notification that there were tax arrears or by issue of an amended tax code
The cut off date is normally 12 months after the end of the tax year in which the information was received. For instance
- HMRC receives a P46(PEN) from a Pension payer on 26 August 2008 for commencement of a pension
- The taxpayer has personal allowances at another source of income
- HMRC fail to issue an amended code to the pension payer during 2008-2009 or 2009-2010
- As a result the taxpayer is underpaid for 2008-2009 and 2009-2010
Because HMRC failed to properly amend the code before 6April 2010, the taxpayer can claim that HMRC has failed in time to use the P46 (PEN).
In exceptional circumstances, the cut off date is when tax is notified 12 months or less after the end of the tax year (see PAYE95075).
Difficulties arise when there is no trace of information or contact that the taxpayer claims was sent or made. Each case should be judged on its merits, using whatever evidence is available in the taxpayer record.
The benefit of the doubt should be given that the information was received if you are confident that it was; for instance by making further enquiries with the taxpayer, their employer or pension payer.
If you are satisfied that HMRC did not receive the information then you should refuse the taxpayers claim.