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HMRC internal manual

PAYE Manual

PAYE service income, allowances, benefits and deductions: IABD: property income

Before entering any amount of income into IABD which is non-PAYE income and is to be included in the tax code, you must first follow the guidance at PAYE12060.

PAYE only cases

For PAYE only cases, property income should be entered on this screen

  • You will need to consider any loss brought forward from the information you hold and ensure this is recorded correctly for the year
  • You will also need to consider any remaining losses to be carried forward to the following year, ensuring you review IABD for CY+1

PAYE / SA cases

For PAYE / SA cases, property income should only be entered on this screen if the latest SA return reflects that the individual is content to have non-PAYE income coded out. If the individual does not want non-PAYE income to be coded out then the ‘adjusted’ profit figure of property income should be included as part of the Non Coded income on the Earnings screen.

The amount will be used by the system when calculating the total income calculation for coding purposes only. It will not be taken into account in the end of year reconciliation as all these cases should be SA Cases.

If property income is being coded out, IABD should be updated with the latest profit or loss figure from the information you hold. The table shows if there is profit or loss on income from property and whether

  • The amount is carried forward to be coded in CY+1
Item Carried Forward
Profit YES
Loss NO
Loss Brought Forward form Earlier Year NO
  • Enter the new / revised amount of profit
  • This will be carried forward by the system to coding each year

Note: For SA cases only, where the customer has included losses brought forward from an earlier year on their latest SA tax return, this figure should not be included within IABD for CY. You should only include the adjusted profit figure for property income.

If at a later date, the customer objects to the amount deducted for property income in their CY tax code on the basis they wish to claim brought forward losses from property income for earlier years, you should

  • Calculate the balance of property income (adjusted profit less losses brought forward = profit or loss)

Where profit

  • Include the reduced figure of property income in IABD for CY

Where loss

  • Remove the property income figure from IABD for CY