SAM2070 - Amend payment: amend payments on account: amendments: errors and corrections
Amendment and re-allocation
Where an amendment reduces payments on account below the amount paid, a re-allocation is triggered and the record may become overpaid.
A subsequent re-allocation of an overpaid amount against a charge for which the due date has passed causes interest and repayment supplement (RPS) to be calculated and included on the taxpayer record.
Inappropriate interest and RPS amounts
Inappropriate amounts of interest and RPS will be included on the taxpayer record if
- A payment on account with a statutory due date earlier than ‘today’ is amended (increased) to correct an earlier decrease made in error, and
- The fresh amendment prompts the re-allocation of an overpaid amount against the increased charge
If you have to correct an earlier amendment be sure you understand the interest and RPS consequences (SAM2080) of making the amendment. You should be particularly careful where
- There is a credit balance on the taxpayer record, and / or
- The amendment will result in the discharge of a paid interest charge
To avoid inappropriate amounts of interest and RPS being calculated you will normally have to transfer any credit balance and / or interest payment to OAS before making the correcting amendment.
Advice about correcting errors
Unless you are clear about the interest and RPS consequences, you should always refer to your SA Manager before attempting to correct these cases.
If you come across a case where inappropriate amounts of interest and / or RPS are included on the taxpayer’s record, refer to ‘Payment allocation and transfer’ (SAM80050) and then the Debt Management and Banking Manual (DMBM). Again, you should seek the assistance of your SA Manager if you are unsure how to proceed.