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HMRC internal manual

Debt Management and Banking Manual

Pre-enforcement: coding out: Self Assessment (SA) and Tax Credit (TC) overpayments: impact of NPS reconciliation on heads of duty

NPS(PAYE) sends details of the payments collected in the PAYE tax code to the Head of Duty (HoD) systems CESA and NTC.

The HoD system receives details of the credit collected in NPS(PAYE), cancels the type 16 remission in full and allocates the credit to record. Any credits are automatically allocated with an ‘Effective Date of Payment’ (EDP) of 6 April in the year in which coding out commenced.

If the debt is collected in full, no further action is required on the record.

If only part or none of the debt is collected:

  • the HoD will send details of the reinstated debt to IDMS as per existing IDMS rules
  • IDMS will recognise that a previous attempt has been made to code out this debt and the work item will be selected by campaigns for the next appropriate action.