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HMRC internal manual

PAYE Manual

From
HM Revenue & Customs
Updated
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PAYE operation: pensioners: P46(LS) - state pension lump sum deferral

From 6 April 2005 anyone who defers their state pension for 12 months or more can choose to receive either

  • An increased weekly amount of state pension
  • A one-off lump sum and the weekly state pension at the standard rate

The purpose of form P46(LS) is for DWP to tell HMRC that an individual has chosen to receive a lump sum payment. The P46(LS) is sent to Leicester and Northants Area (This content has been withheld because of exemptions in the Freedom of Information Act 2000) .

As the lump sum is a one off payment it is not appropriate for live records to be held at this employer reference. If live records are found in day to day work they should be ceased using the start date as the end date.

Where a start date is not held the pension should be ceased using an end date of 06-04-XXXX for the tax year the employment relates to. For example, if employment was created in the 2008-09 tax year the employment should be ceased using 06-04-2008.

The tax code calculation will ignore the lump sum deferral employment because the lump sum payment is a ‘one off’, see PAYE94090 for more information. No P2 notice of coding or P6/P9 employer tax code notifications will be issued for these lump sum deferral cases for the employment reference (This content has been withheld because of exemptions in the Freedom of Information Act 2000) . The employment record for the lump sum deferral (This content has been withheld because of exemptions in the Freedom of Information Act 2000) will not be displayed on the employments allocation screen.