Coding: coding: general principles: manual code work item
The ‘Manual Code’ indicator is set where the automatic coding by the system is to be inhibited.
Work item ‘244 Automatic Coding update - manual code indicator set’ will be triggered for cases where the ‘Manual Code’ indicator is set when NPS is automatically updating tax codes, for example Annual and Budget Coding, and when P11D information is captured on ECS and the benefit information has flowed though to PAYE Service. The tax code will be calculated and the P11D information will be stored on IABD.
Note: Where a Contact History note ‘Manual Code indicator updated during annual coding YY-YY’ is held and there are no other reasons for the ‘Manual Code’ indicator to be set you should cancel the indicator.
The Action Guides relating to work item 244 have been replaced with action guide tax40081 WMI244 which is available on the Customer Operations Guidance Gateway.
You must select the reason for the manual code at the same time the ‘Manual Code’ indicator is set. Remember to cancel the indicator when the reason is no longer valid.
The reasons that can be set are
Benefits - Where a clerical calculated amount of benefits in kind is to be input annually.
Underpayment Collection - Where an underpayment is to be coded out over 2 to 3 years because of hardship.
JSA Adjustment - Where an adjustment for Jobseeker’s allowance has been coded out at the primary employment.
BPR transfer - Where Blind Person’s allowance is transferred between husband and wife or between civil partners.
ESTPAY - Where a manually calculated amount of estimated pay is to be input annually.
PSP - Where the Public Service Pension is not the primary source and the PSP can be coded at the primary source (PAYE76130) in the year of commencement.
FP - Where the Forces Pension is not the primary source and the FP can be coded at the primary source (PAYE76130) in the year of commencement.
For all other cases not falling into the above reasons, for example where the net coding allowances exceed 5 digits (code the case manually), see PAYE11050.
Or for primary sources migrated with codes 0T, NT, BR, or D prefix, you should cancel the ‘Manual Code’ indicator.
Ministers of Religion - refer to SAM100060 and SAM125041.
Issuing a tax code when the manual code indicator is set
Where the ‘Manual Code’ indicator is set, any amendments to daily coding will default the P2 to ‘not issue’.
Where a P2 is to be issued, change ‘not issue’ to ‘issue’, unless a manual P2 is required.
Note: Where a manual P2 is required and the Scottish rate of Income Tax is applicable it is crucial that the tax code issued has an S Prefix, for example, S1100L, SBR, S0T.
Tax code NT is used for both United Kingdom (England, Wales and Northern Ireland) and Scottish taxpayers, therefore the code will not include an S prefix.
Further information is given at PAYE100035
CY P6 issue
Where the ‘Manual Code’ indicator is set, employer output will be inhibited. If a P6 is to be issued and manual correspondence is not required, you should review whether the ‘Manual Code’ indicator is still required.
If the ‘Manual Code’ indicator should no longer be set
- Delete the ‘Manual Code’ indicator and issue the tax code
If the ‘Manual Code’ indicator should remain set
- Remove the ‘Manual Code’ indicator
- Issue the tax code
- When the Tax Code Details screen has been submitted, immediately re-set the ‘Manual Code’ indicator
CY+1 P6 issue - Manual Code indicator and Annual Coding
Where work item 244 has not been reviewed before annual coding P2 final takes place, a code will automatically be calculated and issued. PAYE Service will override the ‘Manual Code’ indicator if appropriate.
When reviewing work item 244 after P2 final has taken place, the code should be reviewed and issued as appropriate. There is no need to remove the ‘Manual Code’ indicator if it is still needed.
The PAYE Service will automatically set the ‘Manual Code’ indicator with a reason of ‘migration’, for certain cases (for example some former Specialist PT residency cases)
- That have had a pseudo main source record and the real employment record was set up as a sub source record before migrating to the PAYE Service
- The PAYE Service cannot reconcile the allowances allocated for the primary and secondary records
There will be a relevant note identifying the coding item to be reviewed at 2009-2010 annual coding and for the ‘Manual Code’ indicator to be cancelled once the code has been reviewed.