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HMRC internal manual

Self Assessment Manual

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HM Revenue & Customs
Updated
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Returns: view and amend return: return amendments: bankruptcy cases (Action Guide)

Follow steps 1 - 14 below where an amended Individuals return is received and

  • The return is for the year that an approved Individual Voluntary Arrangement (VA) or Bankruptcy (BY) (Scotland Award of Sequestration) Order was made

And 

  • The taxpayer ceased to trade during the year of VA/BY but commenced a new trade prior to 5 April following the Relevant Date

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 - 2
   
  Steps 3 - 5
  Steps 6 - 12
  Steps 13 - 14

 

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. For the purposes of this Action Guide the words ‘……in a Revenue Calculation case’ should be read as relating to both circumstances.

 

All cases

1. 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 on the old record
   
2. Calculate the revised liability of the taxpayer for the periods to and from the Relevant Date by apportioning the income, allowances and reliefs. Make a note of any in-year repayment(s) made to enable you to enter the amount in the Tax already refunded field in function CREATE RETURN CHARGE for the appropriate period

Period prior to the Relevant Date

3. Prepare a manual Tax Calculation for the period 6 April to the Relevant Date for issue in a Revenue Calculation case or where you have repaired a Self Calculating taxpayer’s return
   
4. Use function CREATE RETURN CHARGE to enter the amended liability for the period 6 April to the Relevant Date on to the taxpayer’s old record
5. Issue the Tax Calculation to the person set up to act in a capacity for the taxpayer

Period from the Relevant Date

| 6. | Prepare a manual Tax Calculation for the period from the Relevant Date to the 5 April for issue in a Revenue Calculation case or where you have repaired a Self Calculating taxpayer’s return | || | 7. | Use function CREATE RETURN CHARGE to enter the revised 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 in function CREATE RETURN CHARGE by the amount
 
And  | |   | * Treat the amount as positive and increase the entry in the Underpayments for earlier years field in function CREATE RETURN CHARGE by the amount | | 8. | Issue the Tax Calculation to the taxpayer together with a copy to the agent where form 64-8 is held | | 9. | Where the amendment adds a new PAYE source carry out the Coding (Integrity) Check and record the result on the return. You cannot record the result on the computer as the return details have not been captured | | 10. | Use function AMEND TAXPAYER SIGNALS to unset the Manual return signal on the new record | | 11. | 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 | | 12. | Check the return along with the taxpayer’s new record for 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 SEF1 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 notified (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 ticked 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 capture of the amended return details for the year of VA or BY on the old record | || | 13. | Calculate the payments on account due for the following year on the new record | | 14. | 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 |