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HMRC internal manual

PAYE Manual

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

Calculations
Calculation Result Summary

Calculations

Calculations is accessed from IABD on the Navigation Menu.

Customers or their agents will use third party software to submit details of income and expenditure from self-employment and/or income from letting property, bank interest, dividends and pension savings. This information will be submitted in at least 3 monthly intervals and stored in MTDB (Making Tax Digital for Business) Landing. 

The information from these reports is sent to the strategic calculator to perform a calculation using all appropriate allowances and rate bands from the start of the accounting period to the date the submission is made, to give an estimated calculation. The calculation is passed to the Calculation Store. The estimated liability will also be displayed to the customer on their Digital Account and software each time they make a submission.

Calculations can be accessed from the Navigation Menu by selecting

  • IABD
  • Calculations

When Calculations is selected, the Calculation Result Summary screen will be displayed.

Calculation Result Summary {#calc_result_sum}

The Calculation Result Summary screen will display the tax year. You can select and display information for a specific tax year. 2017/18 will be the first tax year.

The Calculation Result Summary screen will display a list of the calculations the customer has received for the tax year. This is a read-only screen.

The screen will display

  • Calculation ID – this is created by the Calculation Store and is used to retrieve the correct calculation when requested
  • Calculation Type
    • Estimated Tax Calculation – this will show the estimated year to date tax calculation based on the submissions reported by the individual
    • Tax Calculation – this will show the final tax calculation for the year
  • Calculation Date – this is the date and time the calculation was performed
  • Start Date – this is the start date for the period of the calculation
  • End Date – this is the end date for the period of the calculation

If more than 10 rows of data, a button will displayed at the bottom of the screen to navigate to the next 10 rows of data.

From the Calculation Result Summary screen, if you select the View Record icon at the right hand side, a summary of the income, allowances, rate bands and year to date tax and National Insurance liability will be displayed.

The screen will display a breakdown of the calculation from the start date of the accounting period to the end date of the submission period.  The personal allowance and rate bands are divided by the number of days for that period.  Class 2 National Insurance is calculated by full weeks.  The screen will also display the ‘in period’ total tax and National Insurance, which is the difference between the total tax and National Insurance liability since the previous calculation.