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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: repairs to amended returns after 31 December (individuals) (Action Guide)

Follow steps 1 - 42 below if you are processing an amended Individuals return

  • After 31 December following the end of the return year

And 

  • A repair(s) is identified which would increase the taxpayer’s liability(This content has been withheld because of exemptions in the Freedom of Information Act 2000)  

And 

  • No repayment is due

Note: A Tax Calculation must be issued in all Revenue Calculation cases and in cases where a taxpayer who originally self calculated has sent an amendment and has not done a full recalculation. In such a case you should remove the tick in the Self - Calc box in LDC to ensure a Tax Calculation is issued. For the purposes of this Action Guide the words ‘……in a Revenue Calculation case’ should be read as relating to both circumstances.

Note: For composite returns for non-resident partners, see SAM121410.

For details of how to access the SA functions, select ‘Index Of Functions’ on the left of the screen.

This guide is presented as follows

  Steps 1 - 6
   
  Steps 7 - 20
  Steps 21 - 33
  Steps 34 - 42

The amendment can be processed using function AMEND RETURN

| 1. | Enter the return details in function AMEND RETURN without making any repairs | || | 2. | Over-ride error messages displayed whilst entering the taxpayer’s amendment and accept the taxpayer’s figure(s) (SAM121265) | | 3. | Include a Customer Service Message (SAM121435) to tell the taxpayer that you have identified an entry or entries that require revision and that you will deal with the revision(s) as soon as possible, where | |   | * The taxpayer has requested Revenue Calculation
 
Or | |   | * A taxpayer who originally self calculated has sent an amendment and has not done a full recalculation. In such a cases you should remove the tick in the Self - Calc box in LDC to ensure a Tax Calculation is issued | |   | Then, the following day or next available day | | 4. | Use function AMEND RETURN to enter the figures following repair. Do not select repair messages or enter Customer Service Messages | | 5. | Select Close and Exit from the File menu heading when you are sure all changes necessary have been made. You will be presented with the SAVE AMENDMENT screen | | 6. | Save the changes as follows | |   | * Select the [Save] button. You will be presented with the SAVE AMENDED RETURN screen for each part of the return you have changed | |   | * Select the Correction radio button for each change made to the return. When you have completed the SAVE AMENDED RETURN screen for all of the return changes select the [OK] button, you will automatically be returned to the menu |

Bankruptcy cases, where the liability is entered using function CREATE RETURN CHARGE

| 7. | Use function VIEW TAXPAYER DESIGNATORY DETAILS to obtain the Relevant Date and to ensure that the Last SA Return Required For Year Ending 5th April signal is set to the year of the return on the old record | || | 8. | Calculate the amended liability of the taxpayer for the periods to and from the Relevant Date by apportioning the income, allowances and reliefs without taking into account any adjustment due to a repair  | | 9. | Where you do not intend dealing with the repair(s) for at least 3 days | |   | * Prepare a manual Tax Calculation for the period 6 April to the Relevant Date for issue in a Revenue Calculation case. Include a Customer Service Message (SAM121435) stating that you have identified an entry or entries that require revision and that you will deal with the revision(s) as soon as possible | | 10. | Use function CREATE RETURN CHARGE to enter the liability for the period 6 April to the Relevant Date on to the taxpayer’s old SA record | | 11. | Issue the Tax Calculation prepared in a Revenue Calculation case to the person set up to act in a capacity for the taxpayer | | 12. | Prepare a manual Tax Calculation for the period from the Relevant Date to the 5 April for issue in a Revenue Calculation case. Include a Customer Service Message stating that you have identified an entry or entries that require revision and that you will deal with the revision(s) as soon as possible | | 13. | Use function CREATE RETURN CHARGE to enter the liability for the period from the Relevant Date to 5 April on to the taxpayer’s new SA record. To do this | |   | Where more than 80 per cent of the total liability for the return year is satisfied by tax deducted at source | |   | * Enter the whole amount of the liability for the period from the Relevant Date in the Underpayments for earlier years field | |   | * Enter 0 (zero) in all the other amount fields with one exception. Where an in-year repayment has been made for the period from the Relevant Date, enter the amount of that repayment in the Tax already refunded field | |   | In all other cases | |   | * Increase the entry in the Income tax due after reliefs field by the appropriate amount of the pre Relevant Date liability (SAM121272)
 
And | |   | * Increase the entry in the Overpayments for earlier years field by the appropriate amount of the pre Relevant Date liability | |   | Where, exceptionally the appropriate amount of the pre Relevant Date liability is negative | |   | * Treat the amount as positive and increase the entry in the Tax deducted at source field by the amount
 
And | |   | * Treat the amount as positive and increase the entry in the Underpayments for earlier years field by the amount | | 14. | Issue the manual Tax Calculation prepared in a Revenue Calculation case to the taxpayer together with a copy to the agent where form 64-8 is held | | 15. | Calculate the taxpayer’s revised liability to and from the Relevant Date, taking into account the repaired amount(s) | | 16. | The following day use function CREATE RETURN CHARGE to enter the revised liability on both the old and new records. (Remember to make the additional entries on the new record in respect of the appropriate amount of the pre Relevant Date liability) | | 17. | Prepare and issue revised (original in Self Calculating cases) manual Tax Calculations including the Revision Notice | | 18. | Use function AMEND TAXPAYER SIGNALS to unset the Manual return signal on the new record | | 19. | Update the taxpayer’s return profile on the new record with details of any new supplementary pages the taxpayer has returned using function MAINTAIN RETURN PROFILE | | 20 | Check the amended return along with the taxpayer’s new SA record where the amendment relates to any of the following 5 situations. Where the taxpayer has made a claim to reduce payments on account see section ‘Claim to adjust payments on account’ (SAM1000 onwards) | |   | * Select ‘Action 1’ and so on, in the right hand column to find out the actions you need to take in each situation |

 

Situation Action
   
LU (Liability Unlikely) set on the record and as a result of the amendment Tax and / or Class 4 NIC liability arises (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
The amendment is of a date a business ceased not previously notified (SA100 box 7 on the Self Employment (full) supplementary page SEF 1 or box 6 on the Self Employment (short) supplementary page SES 1, SA200 box 3.3) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
The amendment is of a date the taxpayer ceased to be a partner in a business not previously shown (box 4 on the Partnership (full) supplementary page PF 1 and on the Partnership (short) supplementary page PS 1) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
The amendment involves the taxpayer transferring surplus allowances to the spouse or civil partner (box 16 of the Tax reliefs section of the core return page TR 4, and box 11 of the married couples allowance section of the Additional information page Ai 3) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
An underpayment of less than £3000.00 arises and the taxpayer has not entered an ‘X’ in the box on the original or amended return to show that the underpayment is not to be coded (SA100 box 2 of the Finishing your Tax Return section of the core return page TR 5, SA200 box 12.8) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

 

 

|   | Creating payments on account where the taxpayer continues to trade in the same trade post 6 April following the Relevant Date | || |   | Following amendment of the return for the year of VA or BY on the old record | | 21. | Calculate the payments on account due for the following year on the new record | | 22. | Use function CREATE RETURN CHARGE on the new record for the VA or BY year to enter | |   | * The calculated amount in the Income tax due after reliefs field
 
And  | |   | * The calculated amount in the overpayments for earlier years field |

 

Computer calculation is incorrect when using function AMEND RETURN. Liability to be entered using function CREATE RETURN CHARGE

| 23. | Abort function AMEND RETURN | || | 24. | Calculate the taxpayer’s liability manually without taking into account any adjustment(s) due to a repair. You may want to use the working sheet within the return guidance notes to achieve this | | 25. | Where you do not propose dealing with the repairs within the next 3 days | |   | * Prepare a manual Tax Calculation for issue in a Revenue Calculation case and include a Customer Service Message (SAM121435) to tell the taxpayer that you have identified an entry or entries that require revision and that you will deal with the revision(s)(s) as soon as possible | | 26. | Use function CREATE RETURN CHARGE to enter the liability | |   | Note: A Section 135(5)(a) deduction may be due. | |   | The Share Scheme supplementary pages deal with the taxable amount arising on the grant of a share option. A liability will only arise on the grant of an option under an unapproved share option scheme, and only if | |   | * The option can be exercised more than seven years after the date it was granted
 
And  | |   | * The option price is less than the market value of the shares on the date of grant | |   | The charge arises in accordance with the provisions of S135(2) ICTA (the measure of the charge in accordance with S135(5)(b) ICTA). | |   | In accordance with S135(5)(a), the tax charged on the grant of the option shall be deducted from any tax chargeable on the exercise, assignment or release of the option. Where the tax charged on the grant of the option exceeds the tax chargeable on the exercise of that option, the deduction is restricted to the tax chargeable on the exercise of the option. | |   | If a Section 135(5)(a) deduction is due (given in terms of tax) you must | |   | * Calculate the amount to be entered in the Income tax due after reliefs field | |   | * For years up to and including 1998-99 the equivalent of box W47, G64 or L69 on the working sheet | |   | * For 1999-00 the equivalent of box C11.43 on the working sheet | |   | * For 2000-01 the equivalent of box c7.52 or w71 on the working sheet | |   | * For 2001-02 the equivalent of box c7.47 or w72 on the working sheet | |   | * For 2002-03 the equivalent of box c7.49 or w74 on the working sheet | |   | * For 2003-04 the equivalent of box c7.47 or w72 on the working sheet | |   | * For 2004-05 and 2005-06 the equivalent of box c7.49 or w74 on the working sheet | |   | * For 2006-07 the equivalent of (boxes c7.49 + c7.54 + c7.55) or w74 on the working sheet | |   | * For 2007-08 the equivalent of boxes A208 + A213 | |   | * Reduce that amount by the S135(5)(a) deduction | |   | * Enter the result in the Income tax due after reliefs field | |   | * Complete any other appropriate fields on the screen | | 27. | Issue the manual Tax Calculation to the taxpayer together with a copy to the agent where form 64-8 is held | | 28. | Calculate the taxpayer’s revised liability taking into account the repairs and prepare a revised (possibly original in Self Calculating cases) manual Tax Calculation including Revision Notice for issue | | 29. | The following day use function CREATE RETURN CHARGE to enter the revised liability. (Remember to reduce the amount in the Income tax due after reliefs field by the S135(5)(a) deduction) | | 30. | Issue the revised (original) manual Tax Calculation | | 32. | Update the taxpayer’s return profile with details any new supplementary pages the taxpayer has returned using function MAINTAIN RETURN PROFILE | | 33. | Check the amended return along with the taxpayer’s record where the amendment relates to any of the following 5 situations. Where the taxpayer has made a claim to reduce payments on account see section ‘Claim to adjust payments on account’ (SAM1000 onwards) | |   | * Select ‘Action 1’ and so on, in the right hand column to find out the actions you need to take in each situation |

 

Situation Action
   
LU (Liability Unlikely) set on the record and the amended return shows Tax and / or Class 4 NIC liability (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
Date of cessation of a business shown on the return (SA100 box 7 on the Self Employment (full) supplementary page SEF 1 or box 6 on the Self Employment (short) supplementary page SES 1, SA200 box 3.3) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
Date taxpayer ceased to be a partner in a business shown on the return (box 4 on the Partnership (full) supplementary page PF 1 and on the Partnership (short) supplementary page PS 1) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
Taxpayer wants to transfer surplus allowances to the spouse or civil partner (box 16 of the Tax reliefs section of the core return page TR 4, and box 11 of the married couples allowance section of the Additional information page Ai 3) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
An underpayment of less than £3000.00 arises and the taxpayer has not entered an ‘X’ in the box on the return to show that the underpayment is not to be coded (SA100 box 2 of the Finishing your Tax Return section of the core return page TR 5, SA200 box 12.8) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

 

Computer cannot calculate liability, manual calculation required and liability is to be entered on the taxpayer record by using function CREATE RETURN CHARGE

34. Calculate the taxpayer’s liability using the taxpayer’s figures. There is a calculation guide you may want to use for taxpayers with Capital gains and Life assurance gains and / or Lump sum compensation payments chargeable under Section 148 ICTA 1988. There are no calculation guides for other (rare) combinations
   
35. Use function CREATE RETURN CHARGE to enter the liability on the taxpayer’s SA record
36. Where you do not propose to deal with the repairs within the next 3 days
  Prepare and issue a manual Tax Calculation in a Revenue Calculation case to the taxpayer together with a copy to the agent where form 64-8 is held. Include a Customer Service Message (SAM121435) stating that you have identified an entry or entries that require revision and that you will deal with the revision(s) as soon as possible
37. Use function AMEND RETURN to enter the taxpayer’s return details, and make the relevant repairs
38. Obtain a copy of the abbreviated reasons for repair(s) made during amendment by using the Copy option from the Edit menu heading on the ALL REPAIRS FOR THIS RETURN screen and copying the details into a separate file
39. Calculate the taxpayer’s revised liability
40. Use CREATE RETURN CHARGE to enter the taxpayer’s revised liability
41. Prepare and issue a revised manual Tax Calculation together with a Revision Notice and any Customer Service Messages you want to make
42. File the return away