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HMRC internal manual

Self Assessment Manual

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HM Revenue & Customs
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Interest, penalties and surcharge: surcharge: TTP start and end dates

This guidance applies to 2009-10 and earlier. Different rules apply to 2010-11 and later tax years. Guidance regarding tax years 2010-11 onwards can be found under SAM61200 onwards.

Start date

The start date of a payment arrangement is the date that time to pay is agreed.

Surcharge

Where the surcharge trigger date is unlikely to be affected the TTP signal should only be set once TTP is agreed. Where TTP cannot be agreed straight away and the surcharge trigger date is likely to be affected the TTP signal must be provisionally set. If TTP is subsequently refused or defaulted the TTP signal must be unset so that appropriate surcharges are automatically raised.

An example illustrating how to establish the start date where the surcharge trigger date is affected is provided as follows:

On 19 February you write to the taxpayer and advise that proposals made in the taxpayer’s letter dated 14 February are unacceptable. You give the taxpayer 14 days to improve the proposal. Note: Provisional details of the payment arrangement should be entered on the taxpayer record by the end of February to prevent a surcharge being raised.

The taxpayer responds on 2 March with fresh proposals which after further negotiation over the telephone, are agreed on 9 March.

In this situation the TTP start date is 14 February because the taxpayer has co-operated and come to an agreed arrangement with the minimum of delay.

In this same situation, if the taxpayer’s response to your letter of 19 February had not been made until 14 March, the start date of any arrangement negotiated would be 14 March, unless the taxpayer had good reason for the delay.

A taxpayer who negotiates an arrangement must be given the benefit of the earlier date.

End date

The end date of a payment arrangement is the date when payment of the last instalment is expected.

Where TTP only includes part of the unpaid SA liability for a year, we recommend you set a TTP end date of no later than 31 January and BF to review the arrangement no later than 31 December. This should give you sufficient time to reach an extended arrangement that covers the full liability for the year. The taxpayer can only avoid surcharge if the arrangement is revised to include the full liability.

When the arrangement is reviewed the taxpayer is given the opportunity to submit proposals that include the balancing payment due for the year. See the Debt Management & Banking Manual (DMBM).

Note: Where the full SA liability is not known it is important to review the case ahead of the balancing payment due date.

Entering start and end dates

There are certain rules in function MAINTAIN TIME TO PAY about entering new or revised TTP details. These rules are that an operator can only

  • Set up a new arrangement if there is no current TTP arrangement (a current TTP arrangement is one where the end date has not yet passed)
  • Amend the start or end date of a current TTP arrangement
  • Cancel the most recent TTP arrangement (whether or not it is current)

If the operator needs to amend one of the dates of an arrangement and the end date of that arrangement has passed (that is the arrangement is not a current one) the operator should

  • Cancel the expired arrangement
  • Use function MAINTAIN TIME TO PAY to set up a new arrangement which shows the correct dates