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HMRC internal manual

Self Assessment Manual

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HM Revenue & Customs
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Returns: view and amend return: dealing with taxpayer amendments

General

Just as HMRC has the right to repair an obvious error or mistake on a return the taxpayer has the right to amend it, within 12 months of the statutory filing date. For amendment purposes the statutory filing date is 31 January following the end of the tax year or 3 months from receipt of a Notice to File by the taxpayer (if it’s a late issue) whichever is the later. For example, a return for 2009-2010 is issued late (after 31 October 2010). The filing date is 22 August 2012 so a taxpayer amendment may not be made more than 12 months after the filing date.

The taxpayer amendment may be in the form of a letter, an amended return, an extra supplementary page or an amended supplementary page. HMRC will normally accept an amendment to a return or self assessment under Section 9ZA TMA whether notified by the taxpayer or by an agent authorised to act on the taxpayer’s behalf, but it must be supplied in writing.

Note: Where electronic voice recording operates in Contact Centres, certain amendments to returns can be accepted by telephone. Further details are available on the Customer Contact pages of the HMRC Intranet site.

On receipt of an amendment to a partnership return you should first check who has signed the amendment. If the amendment has been signed by someone other than the nominated partner, see subject ‘Maintain Taxpayer Record: Nominated Partner’ (SAM101290), or agent, you should check in SA Notes to see if a notification of a change in nominated partner (form SA670) is held. S12AA (12) places a formal obligation on the partners to notify HMRC of a change in nominated partner. If there is no notification in the PN pad (or in the post on hand), you should raise the question as to whether the nominated partner has changed with the partnership. If the nominated partner has not changed you should advise the partnership the amendment cannot be processed without the nominated partner’s or agent’s signature.

HMRC reserve the right to be satisfied in any particular case that the taxpayer has in fact authorised any amendment notified by an agent.

Where the original return is held in the office / area dealing with the amendment, all taxpayer amendments should be linked with the taxpayer’s original return before processing. Where the original return is not held in the office / area dealing with the amendment, the amendment should be processed then stored in post batches. In all cases, select the SA Note (Amendment to (year) SA return re (details) filed in (batch/tax return)) from the SEES Notes Paster.

Note: A batch identifier history, available within function MAINTAIN RETURN SUMMARY from April 2007, will display the previous logging / location details of a return. On each occasion that a return is logged function MAINTAIN RETURN SUMMARY will be automatically updated. A [Batch History] button will be available where a return for the selected year has been logged on more than one occasion. If this button is selected, a new screen will display any previous return batch identifier, and the associated date, for the return for the year selected. However, only the latest 10 return batch identifiers will be stored; where a return is logged on more than 10 occasions, the oldest identifier will be removed from the display.

HMRC has 9 months from the date on which the taxpayer amendment is received in which to revise (repair) any obvious errors or mistakes made in that amendment.

Individuals, Trust and Tax Return for Trustees of Registered Pension Schemes returns

If a repair(s) to the taxpayer amended return is necessary during processing (whether by using function CAPTURE RETURN, Technical Support System or manually), and the repair increases the liability, the due date for payment of the additional tax arising from the repair is the later of

  • The original due date

Or

  • 30 days from the date the taxpayer is issued with the Revenue Calculation advising him of the revision (repair).

If you are processing an amended return, after the 31 December following the end of the return year special attention should be given to cases where a repair is necessary which would increase the taxpayer’s liability (This content has been withheld because of exemptions in the Freedom of Information Act 2000) but no repayment is due. This is because any surcharge (for years 2009-2010 and earlier) or late payment penalty (for years 2010-2011 onwards) will be incorrect if the amendment is processed normally.

More information is available within the Action Guides for ‘Dealing With Taxpayer Amendments’, specifically at ‘Repairs To Amended Returns After 31 December (AG)’ (SAM124063).

Individuals, Partnership, Trust and Tax Return for Trustees of Registered Pension Schemes returns

If you receive an amended Individual, Partnership, Trust or Pension Scheme return

  • Before the details are captured in function CAPTURE RETURN or entered in TSS

Or

  • Before you have calculated the liability manually

Or

  • While the Individual or Partnership return is stored in Local Data Capture (LDC)

You may use the amended details to calculate the liability, replacing the entry or entries on the original return, unless the amendment is received after 31 December following the end of the return year.

See subject ‘Taxpayer amendment received before original return captured’ (SAM124050) for more information.

Individuals returns

Where a return has been captured in full in function CAPTURE RETURN you must use function AMEND RETURN to enter the taxpayer’s amended details. However there are rare occasions when the automatic calculation will be wrong (SAM121275).

Where this was identified during capture of the return, the liability would have been calculated manually and the liability recorded on the taxpayer’s record using function CREATE RETURN CHARGE.

In such a case it will not be possible to use function AMEND RETURN to process a taxpayer amendment.

If the liability can now be automatically calculated due to the amendment, function CAPTURE RETURN can be used to process the amendment. It will be necessary to prominently note the papers supporting the amendment that the amendment has been processed in CAPTURE RETURN.

If the computer calculation will still be incorrect or will now be incorrect, it is necessary to calculate the revised liability manually and enter the taxpayer’s amended liability using function CREATE RETURN CHARGE. Further manual action is then required to update the taxpayer’s record.

In cases where the amendment reduces the figure at box INC10 (Pensions) and the figure in INC11 (Tax taken off box 10) now exceeds the figure in box INC10, the return amendment will not be accepted. In these cases use the full tax calculator in SEES for the appropriate year to recalculate the liability. The CRC (Create Return Charge) tab, shown after the Calculation screen, will show the entries that you should enter in the Create Return Charge screen on SA in order to amend the charge.

If an earlier year’s liability has increased after capture of the return for the later year, no special action is required. If the additional underpayment has been coded, the amount will be captured in box 7 of the Tax Calculation Summary page TC 1 (SA110) or box 2.6A (SA200) on a later return.

If an earlier year’s liability has reduced after capture of the return for the later year with the result that the TC 1 box 7 (SA110) or 2.6A (SA200) entry is too high, action as follows

Revenue calculation case and amendment can be carried out within the time limit for amending the return (SAM124165).

  • Use function AMEND RETURN and repair TC 1 box 7 (SA110) or 2.6A (SA200) to the correct amount that should have been coded

Self calculation case and amendment identified within the time limit for amending the return

  • Invite the taxpayer to amend the TC 1 box 7 figure on the return

In all other cases treat the amendment the same as an error or mistake claim and set off or repay the amount now due. For more information see section ‘Claims made outside a return’ (SAM114000 onwards).

Function AMEND RETURN will not trigger an automatic repayment. If the taxpayer has claimed a repayment the refund should be made using function ISSUE REPAYMENT FROM OVERPAID BALANCE.

There is no facility to save a partially captured return with function AMEND RETURN. If you have to ask advice before you can complete the amendment you must abort function AMEND RETURN and deal with the amendment in full when you are satisfied you can complete the amendment.

You must take care when using function AMEND RETURN as each amendment which alters the taxpayer’s liability and is the result of a correction to a self calculating taxpayer’s liability or is a Revenue Calculation case, will prompt the automatic issue of a Tax Calculation.

If you amend a taxpayer’s return more than once in a day the taxpayer will receive more than one Tax Calculation with the same date reflecting each amendment. (The following years payments on account on each Tax Calculation will however reflect the last amendment processed.) In addition all the changes will show up on the taxpayer’s statement.

Ideally you should only make one amendment per taxpayer per day. Exceptionally where you do need to make more than one amendment in a day, consider sending a letter to the taxpayer advising which amendment is the correct one.

Note: You must remove the tick in the Self - Calc box in LDC to ensure a Tax Calculation is issued where the taxpayer

  • Originally self calculated (the taxpayer completed a Tax Calculation Summary (SA110))

And

  • Has sent an amendment to the return

And

  • Has not included a revised Tax Calculation Summary (SA110)

An amendment may be received in a case which has previously been removed from SA and where the Last Year SA Return Required signal has been set. If you become aware that the amendment brings the case back within the SA criteria, you should reactivate the dormant SA record. For further information refer to the Action Guide ‘Return Amendments: Last Year SA Return Required Signal Already Set’ in this section.

More information is available in section ‘Individuals Returns’ in this business area on the subjects covered in the Action Guides as follows

Action Guide Subject in Individuals Returns section Reference
     
Return amendments: Bankruptcy case Bankruptcy cases SAM121270
Return amendments: Composite returns for non-resident partners Composite returns for non-resident partners SAM121410
Return amendments: Computer calculation is incorrect Computer calculation is incorrect. Creating a return charge SAM121420
Return amendments: Prior year adjustments Prior year adjustments: Individuals SAM121180
Repairs to amended returns after 31 December Repairing returns after 31 December SAM121540