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HMRC internal manual

Compliance Operational Guidance

HM Revenue & Customs
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Supporting Guidance: employer compliance: guidance by subject: open year inaccuracies: Caseflow - how to calculate current year liability/future revenue benefit (FRB)

Following the introduction of Real Time Information (RTI), in the majority of compliance checks there will be no current year liability for recording on Caseflow as you will be dealing with ‘closed return periods’.

There may be certain circumstances where you can claim compliance revenue, for example where an adjustment is agreed with the employer and you close your compliance check before HMRC receives the RTI return (Full Payment Submission). You may record notional compliance revenue (FRB) for this current year adjustment period.

Note: Current year adjustment (CYA) should be recorded as FRB. For further guidance on calculating and recording CYA see COG18215.

See COG910130 in relation to construction industry cases monthly returns.

You must

  • take care to follow the guidance at COG915640 when recording compliance revenue.

To show how the liability was arrived at you should

  • prepare a calculation, and
  • record this on a working sheet within the case papers.

The calculation should show

  • the underpayment up to the time that the adjustments were made, plus
  • an estimate of the underpayment for the remainder of the tax year.

When an inaccuracy has clearly ceased, there is of course no estimate for the remainder of the year.

Note: Information held by HMRC may be requested under the Data Protection Act or Freedom of Information Act. It is therefore important that the current year liability calculation is accurate.