Payment Allocation, Overpayments and Repayments: Self Assessment: Payment Allocation and Transfer: Introduction
The term ‘allocation’ or ‘re-allocation’ is used to describe how a payment is apportioned to liabilities on a customer’s SA record. The movement of a credit to or from an SA record is described as a ‘transfer’.
Payments processed in DMB Banking
DMB Banking process the vast majority of payments that customers make. The SA batch function to process payments receives details of all the payments processed by DMB Banking in a single day, and stores them on the database.
SA payments are separately identified and posted to the customer’s SA record and to the Management Account. The batch process uses automatic allocation rules to determine which liabilities to set payment against.
SA only accepts payments that match with an SA record on the database. Any non-matched payments are re-directed by SA to the OAS system.
Local office payments and transfers in
SA payments banked by local offices and payments proper to SA customers held on other systems are transferred to the SA record through OAS.
The transfer from OAS to SA is made by DMB Banking using an online function. Payments that are transferred from OAS are also subject to the automatic allocation rules.
Payment allocation, overpayments and excess payments
Each SA payment that finds a matching customer record is credited in full to that record. The payment is allocated against any charge that is outstanding or that becomes due within the next 45 days.
Note: The 45 day period is a parameter and can be varied.
Any excess amount paid is held on the SA record as an unallocated amount.
Note: An SA record can show a credit balance.
If a paid liability on the customer record is reduced, the resultant overpayment is re-allocated against any other SA charge that is due or about to become due. Any excess amount that cannot be re-allocated normally remains on the SA record as an overpaid amount. The one exception, where an excess is treated as an unallocated amount, is where the excess was previously allocated to an interest charge.
An overpaid or unallocated amount remains on the SA record until a fresh SA liability becomes due, a repayment request is received, or a collectible pre-SA liability is discovered. Money that is to be set against a pre-SA liability, or a liability on another SA record, is transferred to OAS. OAS is also used to repay a payment in error.
Payments are allocated or re-allocated to charges using automatic allocation rules.
There is an online function CLERICAL REALLOCATION that can be used to amend a payment allocation on the SA record of an individual or trust. Any other transfer of a payment for example to another taxpayers account, can be done by transferring the payment from SA to OAS with appropriate disposal instructions.
The customer is notified of the balance on an SA record when a statement is issued.
Note: You cannot tell whether an excess is an overpaid or unallocated amount from the description of the excess credit on the statement. An excess amount is always described as ‘unallocated’ on the statement. To establish whether an excess is an overpaid or unallocated amount you have to look at the allocation history of the payment(s) making up the excess.
The movement of a credit to or from an SA record is described as a ‘transfer’. Payments can only be transferred between SA and OAS. There is no facility for moving payments directly between two SA records. Three online functions are available for making transfers
- two functions for transferring a credit from SA to OAS, and
- one function for transferring a credit from OAS to an SA record.
Viewing payment credits and debits
Payment credits on the customer’s SA record can be viewed on screen by looking at the statements. Each payment credit posted indicates whether the payment was processed by DMB Banking or transferred from OAS.
Full details of each payment credit on the statement can also be viewed including the allocation history. Where a payment credit is subsequently returned, or all or part of it is transferred to OAS or repaid, the related debit can be viewed along with the original payment credit posting.
All the credits on an SA record for a specific customer can be viewed on screen by using the function VIEW TAXPAYER CREDITS. The credits can then be selected to view the latest allocation details of that credit.