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HMRC internal manual

COTAX Manual

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HM Revenue & Customs
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Repayments / reallocations: non automatic repayments: direct repayment - responsible office (Action Guide)

To issue a non-automatic repayment to debit or credit card or by Bacs or payable order consider steps 1 - 15.

Making a repayment to a UK bank account Steps 1 - 6
   
Making a repayment of £100,000 or less to an overseas bank account Steps 7 - 8
Making a repayment exceeding £100,000 or more to an overseas bank account Steps 9 - 15

Making a repayment to a UK bank account

COTAX knows the conditions for making repayment to debit or credit card and always applies those rules. If repayment to card is appropriate, you cannot and must not try to override the system to repay by another method. See COM125010 for more information.

1. Use function VPPD (View Postings and Payment Details) to confirm that there is an overpayment.
   
2. If there are no bank account details held in VTPR (View Taxpayer) option ‘bank and nominee details’ and you want to record them for this repayment and future repayments, go to step 3.
  If you want the repayment to be issued to the bank account already held in VTPR option ‘bank and nominee details’, go to step 4.
  If you want to make this repayment to a different bank account to that held in VTPR option ‘bank and nominee details’ but you do not want to permanently overwrite the details held, go to step 5.
  If you have been unable to obtain bank details and need to make the repayment by payable order, go to step 6.
3. If no bank account details are held in VTPR, use function BOND (Bank and / or Nominee Details) to record the details of the bank account or nominee for use in this and future repayments, then go to step 4.
4. If repayment is to be issued to the bank account already held in VTPR, use function DIRR (Direct Repayment) to repay an overpayment or specific amount. The bank account details held in VTPR option ‘bank and nominee details’ will be used.
5. If repayment is to be made to a different bank account to that held in VTPR:
  * use function DIRR to repay an overpayment or specific amount. The bank account details held in VTPR option ‘bank and nominee details’ are displayed. On screen COT171J, overwrite the bank account details with those for the account to which you want to make this repayment.
  * use function NOTE (Case Notes) to record why the repayment is being issued to a different bank account to that held in COTAX.
6. If repayment is to be made by payable order:
  * use function DIRR to repay an overpayment or specific amount. If there are no bank account details displayed, or if, exceptionally, you delete the bank details, the repayment is made by payable order.
  * do not select ‘Y’ in the ‘Do you want to issue this repayment manually?’ field. This is only for repayments to be made using a PORF (Payable Order Request Form).
  You cannot make a repayment of £150,000 or more by payable order. See COM125020 for more information.

Making a repayment of £100,000 or less to an overseas bank account

COTAX cannot make a repayment to an overseas bank account by Bacs.

7. Use function VPPD (View Payments and Postings Details) to confirm that there is an overpayment.
   
8. Use function DIRR (Direct Repayment) to repay the overpayment or specific amount by payable order. Do not select ‘Y’ in the ‘Do you want to issue this repayment manually?’ field. This is only for repayments to be made using a PORF.

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Making a repayment exceeding £100,000 or more to an overseas bank account

9. Use function VPPD (View Payments and Postings Details) to confirm that there is an overpayment.
   
10. Confirm the recipient bank can accept CHAPS payments in sterling.
11. Use function REOD (Reallocate Overpayment out of COTAX) to reallocate the overpayment to OAS.
12. Complete form CT251 as a repayment case and where the amount is in excess of £250,000, follow the large repayment guidance at COM124040 before sending the CT251 to the CT Unit in Cumbernauld. COM120100 has guidance on completing form CT251.
13. Send the CT251 along with an additional memo to the CT Unit in Cumbernauld advising them that the repayment is being made to an overseas bank account and needs to be made by CHAPS.
  You must also provide them with a copy of a letter from the company on the company’s letter headed paper giving the following details.
  * Confirmation that the foreign bank will accept sterling (where applicable).
  * The SWIFT code.
  * The IBAN number.
  * Account name.
  * Sort code.
  * Account number.
  * Bank name and address.
14. Use function NOTE to record what you have done.
15. The CT Unit in Cumbernauld will make the necessary arrangements with the Treasury Services Team to make the repayment by CHAPS.