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HMRC internal manual

Debt Management and Banking Manual

From
HM Revenue & Customs
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Returned payments: returned payments in Self Assessment (SA)

 
 
 
 
 

Cheque, Bank Giro, and Girobank payments

Returned payments actioned through Automatic Remittance Processing

Where the Bank returns a payment and the original credit was posted in full to SA, it is actioned by input through Automatic Remittance Processing (ARP). The SA System uses the payment reference and the amount of the returned payment to:

  • locate the original payment posting
  • create a new minus payment posting on the customers record equal to the amount of the original payment posting.

Where this happens you will see the payment being deducted from the customer’s record with a Transaction description of ‘Payment Returned’ and an effective date of payment equal to the original payment posting. If you then select the line number of the posting the Adjustment Type will show ‘DCH’.

Returned payments actioned through OAS

Returned payments that cannot be actioned through ARP are those which:

  • were only used in part to satisfy an SA liability
  • have been repaid in full or in part
  • were transferred to SA through OAS.

In these cases the returned payment is actioned through OAS by the Book 18 team within DMB Banking. They allocate these cases a Book 18 number, and note this together with details of the returned payment in the SA Notes.

Original payment part allocated to SA

Where only part of the payment is allocated to SA, a minus entry is created in OAS for the SA element of the payment. The corresponding SA payment is then transferred to OAS, and the plus and minus entries in OAS are cross-referenced.

Original SA payment repaid

If all or part of the returned amount has been repaid, a minus entry is created in OAS for the full amount of the payment. Any part of the SA payment that has not been repaid is then transferred to OAS, and the plus and minus entries in OAS are cross-referenced.

The follow up action to recover the over-repayment is then taken by the Error Statement Team in DMB Banking.

Original payment transferred to SA through OAS

Where a payment that was transferred to SA through OAS needs to be actioned a minus entry is created in OAS for the full amount of the payment posted in SA. The corresponding payment is then transferred from SA to OAS, and the plus and minus entries in OAS cross-referenced.

Recalls - BACs, Faster Payments, CHAPs, internet, and telephone banking payments

Payments recalled by the customer’s bank are actioned through OAS by the Book 18 team within DMB Banking. They allocate these cases a Book 18 number, remove the amount of the recall from the customer’s record, and make a note in the SA Notes.

Direct Debit payments

Normally we receive an unpaid notification from the Bank before the Receipts Clearing System updates the customer’s record with the payment. Where this happens you will not see a NDDS unpaid posting on the customer’s record. Exceptionally, where we receive a late unpaid notification and the customer’s record has already been updated to show the payment, the Banking Central Direct Debit Team (BCDDT) in DMB Banking arrange for the failed credit to be removed from the record.

Late payment interest

When a returned payment is removed from the customer’s record the late payment interest position is reviewed.