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HMRC internal manual

Tax Credits Manual

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HM Revenue & Customs
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Renewals - work lists (Unprocessed): Unprocessed S17 work list - RTI Incompatible

Checklist

Before you follow this guidance, make sure

  • you follow the guidance in TCM0138020
  • you follow the guidance in TCM0262120
  • you have the correct user roles to follow this guidance
  • you are in the correct MU. Use TCM0322460 for the correct MU number
  • you have access to the National Insurance and Pay As You Earn System (NPS)
  • you have access to the Access To DWP (ADD) system.

Guidance

Note: When sending customer, staff or process data to another individual or team, make sure you follow the latest data security guidelines or contact the Data Guardian or Data Security Team for advice.

Note: When instructed to calculate a customer’s new hours using the National Minimum Wage (NMW) calculator, apply the following tolerance levels.

Claimed Hours Allowable Hours after NMW Calculation
   
30 27+
24 22+
16 14+
8 7+

Where the allowable hours are within the tolerance level, staff should not

  • query the hours with the customer

or

  • complete a change of circumstances to change the customer’s hours

Step 1

Check the correct award version details. For how to do this, use TCM1000007.

  • make a note of the correct award version
  • go to .

Step 2

Check NTC for the work list reason. For how to do this use TCM1000004.

If you are dealing with an Incompatible work list reason only, follow the guidance in TCM0272200

If you are dealing with an RTI Incompatible work list reason only, go to .

If you are dealing with an RTI Incompatible work list reason as well as an Incompatible work list reason

  • make a note on a TC648 to establish all of the Incompatibility reasons before any customer contact is made
  • go to .

If you are dealing with an RTI incompatible with ‘Duplicate’, follow the guidance in TCM0272140

If you are dealing with an RTI Incompatible with ‘Superseded’, follow the guidance in TCM0256020

Step 3

Check what you are dealing with.

If you are dealing with a new work item, go to .

If you have issued a TC1221 and the action date has expired, go to .

If you have issued a TC1221 and the customer has replied, go to .

If you have issued a TCC50 and the action date has expired, go to .

If you have issued a TCC50 and the customer has replied, go to .

If you are dealing with a telephone call from the customer, go to .

If an enquiry has been received marked RLS, go to .

Step 4

Check if the TCC50 contains all the relevant information.

If the TCC50 contains all the information to complete the renewal, go to .

If the TCC50 does not contain all the information to complete the renewal, go to .

Step 5

Check for a new address. For how to do this, use TCM0184200.

If a new address has not been found, go to .

If a new address is found

  • reissue the TCC50 or a TC1221 as appropriate to the customer
  • take no further action.

Step 6

Check View S17 screen, make a note of the income declared by each customer and the RTI income we have replayed on the S17 for each of them if appropriate. For how to do this use TCM1000011.

Check (NPS) to establish if the RTI data has been altered since the S17 was issued to the customer and be aware this may be the reason for the discrepancy. There may also be allowable deductions which can be accounted for in NPS, a list of allowable deductions can be found in TCM0322175 and if the customer’s income is below NMW, make a note to issue a TCC50.

Note: If you are dealing with one of the specific criteria below:

  • a single claim with only employment income (matching RTI) declared
  • a single claim with employment income (matching RTI) and self-employment income declared
  • a joint claim where both applicants have declared employment income (both matching RTI)
  • a joint claim where both applicants have declared employment income (both matching RTI) and either or both declaring self-employment income
  • go to .

Note: Where there is an Other Income figure recorded, you must use the adjusted figure as this will be after £300 has been disregarded.

If the reason for the discrepancy has been identified via PAYE and you are happy with the figure the customer has declared, go to .

If the reason for the discrepancy has been identified and you are not happy with the figure declared after looking into the possibility of allowable deductions

  • make a note on the TC648 to issue a TC1221
  • go to .

Step 7

Check all the RTI Incompatible worklist reasons for each customer and make a note to work them in them in the order listed below.

Note: Where you are dealing with a joint household, you will need to establish all the RTI incompatibilities for both the customer and their partner.

If the RTI worklist reason you are working is RTI Incmpt, go to .

If the RTI worklist reason you are working is RTI Dis Incmpt, go to .

If the RTI worklist reason you are working is RTI O Incmpt, go to .

If the RTI worklist reason you are working is RTI O Dis Incmpt, go to .

If the RTI worklist reason you are working is RTI O Incmpt HB, go to .

If the RTI worklist reason you are working is RTI OD Incmpt HB, go to .

Step 8

Check the Access to DWP Data (ADD) system to establish if the customer or their partner were in receipt of any qualifying benefit during the whole of the previous year (PY). For how to do this, follow the guidance in the ADD manual and TCM1000014.

Note: If the customer was not in receipt of a qualifying benefit during the whole of PY, include any Taxable Social Security Benefits found.

If ADD shows that the customer or their partner was in receipt of a qualifying benefit during the whole of PY

  • make a note on the TC648 if the customer or their partner have been in receipt of a qualifying benefit for the whole of the PY
  • update NTC with the qualifying benefits dates if necessary. Follow the guidance in TCM0048100

Note: Although NTC has obtained an RTI employment figure for the customer, they do not need to provide a figure for the previous year.

  • go to .

If ADD shows that the customer or their partner was not in receipt of a qualifying benefit during the whole of PY, go to .

Step 9

Check if the RTI Income Incompatibility is the only work list item.

If the RTI Income Incompatibility is the only work list item

  • clear the RTI Incompatibility work list item by updating the customer’s employed earnings figure with £1 and process the Annual Declaration. For how to do this use TCM1000015
  • select ‘Yes’ to override the RTI Discrepancy Incompatibility error message that will be displayed
  • update Household Notes with the message SD73 from TCM0172020. For how to do this use TCM1000001
  • go to .

If the RTI Income Incompatibility is not the only work list item

  • make a note on a TC648 that you will need to enter a figure of £1 in the customer’s employed earnings field in ‘Capture A Renewal Declaration’
  • continue to deal with the other worklist items
  • go back to and work each of the remaining incompatibility reasons in order.

If you have resolved the RTI Incompatible work list reason and now have to deal with another Incompatible worklist reason

  • make a note on a TC648 that you will need to enter a figure of £1 in the customer’s employed earnings field in ‘Capture a Renewal Declaration’
  • continue to deal with the other Incompatible work list items. To do this, follow the guidance in TCM0272200.

Step 10

Check whether there are other outstanding RTI incompatibilities. Follow the guidance in TCM0322400.

Note: Ensure that you have dealt with any RTI incompatibilities for both customers in a joint household.

Note: You should check Household Notes for deductions made to either customer’s income in the previous year as an indication of the reason for the incompatibility.

If there are other outstanding incompatibilities that are RTI incompatibility reasons only

  • work through each of the RTI incompatibilities
  • make a note to contact the customer for the missing income or to clarify the income discrepancy
  • go to .

If there are no other outstanding incompatibilities that are RTI incompatibility reasons but there are outstanding incompatibility reasons

  • make a note to contact the customer for the missing income or to clarify the income discrepancy
  • follow the guidance in TCM0272200 to resolve the incompatible reasons and return to this guidance.

Note: You will need to ensure that you have made a note of all the information you will require before contacting the customer.

If there are no other outstanding RTI incompatibility reasons, go to .

Step 11

Check if either customer has declared an untraced TSSB, Other Income, State Benefit, Employment Income or Benefit in Kind, within £500.00 of an undeclared traced income on either customer.

If either customer has declared an untraced amount within £500

  • update correction on NTC with the traced income for the correct customer and disregard the untraced declared amount
  • go to

If either customer has not declared an untraced amount within £500, go to .

Step 12

Contact the customer by phone. Follow the guidance in TCM0094080.

If you are able to contact the customer by phone and you are dealing with a RTI Incmpt, go to .

If you are able to contact the customer by phone and you are dealing with a RTI Discrep Incmpt, go to .

If you are able to contact the customer by phone and you are dealing with a RTI Oth Incmpt or RTI Oth Incompt HB, go to .

If you are able to contact the customer by phone and you are dealing with a RTI Oth Dis Incmpt or RTI Oth Dis Incompt HB, go to .

If you are not able to contact the customer by phone and you are dealing with any of the above

  • make a note to issue a TC1221
  • go to .

Step 13

Explain to the customer they need to provide an income figure as this was not provided on their Annual Declaration.

If the customer has provided an earned income figure that is equal to or more than the RTI figure we have obtained

  • make a note to use the income figure declared by the customer
  • go to .

If the customer has provided an earned income figure less than the RTI figure we have obtained and the difference is within £500

  • make a note to use the income figure declared by the customer
  • go to .

If the customer has provided an earned income figure less than the RTI figure we have obtained and the difference is £500 or more,

  • go to .

If the customer has not provided an earned income figure

  • advise the customer that you will continue to use the income provided by their employer and make a note to use the RTI earnings figure
  • go to .

Step 14

Check if the customer wants to provide an amended income figure to the figure provided on their Annual Declaration.

If the customer has provided an amended income figure that is equal to or more than the RTI figure we have obtained

  • make a note to use the income figure declared by the customer
  • go to .

If the customer has provided an amended income figure less than the RTI figure we have obtained and the difference is within £500

  • make a note to use the income figure declared by the customer
  • go to .

If the customer has provided an amended income figure less than the RTI figure we have obtained and the difference is still £500 or more, go to .

If the customer has not provided an amended income figure, go to .

Step 15

Check if the customer can give us a satisfactory explanation as to why their income details are different from the figures supplied by their employer.

Note: This could be because the customer pays into a pension scheme, or they have deducted maternity, adoption or paternity pay. They may also have made gift aid contributions. This is not a complete list. Follow the guidance in TCM0322175 for a list of allowable deductions from income.

If you are satisfied with the explanation the customer has provided

  • make a note to use the income figure declared by the customer and the reason for the difference
  • go to .

If you are not satisfied with the explanation the customer has provided

  • advise the customer that you will continue to use the income provided by their employer and make a note to issue a TC1221
  • go to .

Step 16

Ask the customer to provide an Other Income Figure as this was not provided on their Annual Declaration.

If the customer has provided an Other Income figure that is equal to or more than the RTI figure we have obtained

  • make a note to use the Other Income figure declared by the customer
  • go to .

If the customer has provided an Other Income figure less than the RTI figure we have obtained and the difference is within £3000

  • make a note to use the Other Income figure declared by the customer
  • go to .

If the customer has provided an Other Income figure less than the RTI figure we have obtained and the difference is £3000 or more,

  • go to .

If the customer has not provided an Other Income figure

  • advise the customer that you will continue to use the Other Income provided by their pension provider and make a note to issue a TC1221
  • go to .

Step 17

Check if the customer wants to provide an amended Other Income Figure to the figure provided on their Annual Declaration.

If the customer has provided an amended Other Income figure that is equal to or more than the RTI figure we have obtained

  • make a note to use the Other Income figure declared by the customer
  • go to .

If the customer has provided an amended Other Income figure less than the RTI figure we have obtained and the difference is within £3000 

  • make a note to use the Other Income figure declared by the customer
  • go to .

If the customer has provided an amended Other Income figure less than the RTI figure we have obtained and the difference is £3000 or more

  • go to .

If the customer has not provided an Other Income figure, go to .

Step 18

Check if the customer can give us a satisfactory explanation as to why their Other Income details are different from the figures supplied by their pension provider.

Note: This could be because the customer pays into a pension scheme, or they may also have made gift aid contributions. This is not a complete list. Follow the guidance in TCM0322175 for a list of allowable deductions from income.

If you are satisfied with the explanation the customer has provided

  • make a note to use the Other Income figure declared by the customer and the reason for the difference
  • go to .

If you are not satisfied with the explanation the customer has provided

  • advise the customer that you will continue to use the Other Income provided by their pension provider and make a note to issue a TC1221
  • go to .

Step 19

From the notes you have made, decide which letter you need to issue.

Note: Before issuing a letter do not forget to apply the relevant tolerance level referred to at the start of this guidance.

Note: If you need to issue both letters a TCC50 and a TC1221, issue a TCC50 and include the income question.

If you need to issue a TC1221 only

  • issue a TC1221 and ensure that all questions asked are based on the notes you have made
  • update the Household Notes with the message SD79 from TCM0172020. For how to do this use  TCM1000001
  • transfer the ‘Unprocessed S17’ work list item to the ‘Unprocessed S17 Incompatible BF’ MU. For how to do this use TCM1000304.  Use TCM0322460 for the correct MU number
  • set an action date for 30 days in the future. For how to do this use TCM1000008
  • go to .

If you need to issue a TCC50 only

  • issue a TCC50 and ensure that all the questions asked are based on the notes you have made
  • update Household Notes with the message SD74 from TCM0172020. For how to do this use TCM1000001
  • transfer the ‘Unprocessed S17’ work list item to the ‘Unprocessed S17 Incompatible BF’ MU. For how to do this use TCM1000304.  Use TCM0322460 for the correct MU number
  • set an action date for 30 days in the future. For how to do this use TCM1000008
  • take no further action.

Step 20

Check the TCC50/TC1221 to establish the income that the customer and/or partner has provided for us against the RTI figures that you have already noted.

Note: You must repeat this step if you have also asked for information from a partner.

Note: The customer may have provided information for non RTI Incompatibles on the TCC50. If so, follow the guidance in TCM0272200 to resolve these incompatibility reasons.

If the customer has provided an amended earned income figure / Other Income figure that is equal to or more than the RTI figure we have obtained

  • make a note to use the income figure declared by the customer
  • go to .

If the customer has provided an amended earned income figure / Other Income figure less than the RTI figure and the difference is within £500

  • make a note to use the income figure declared by the customer
  • go to .

If the customer has provided an amended earned income figure/ Other Income figure less than the RTI figure and the difference is still £500 or more

  • go to .

If the customer has not provided an explanation of the discrepancy

  • advise the customer that you will continue to use the earned income provided by their employer and make a note of this
  • go to .

If the customer is disputing the RTI income due to incorrect employment details

  • use the customer’s estimate for Current Year (CY)
  • advise the customer to dispute the Previous Year (PY) overpayment
  • tell the customer to ring 0300 200 3300 to report that the employer has provided incorrect details
  • go to .

Step 21

Check if the customer can give us a satisfactory explanation as to why their income details are different from the figures supplied by their employer or pension provider.

Note: This could be because the customer pays into a pension scheme, or they have deducted maternity, adoption or paternity pay. They may also have made gift aid contributions. This is not a complete list. Follow the guidance in TCM0322175 for a list of allowable deductions from income.

If you are satisfied with the explanation the customer has provided

  • make a note to use the income figure declared by the customer and the reason for the difference
  • go to .

If you are not satisfied with the explanation the customer has provided

  • advise the customer that you will continue to use the income provided by their employer or pension provider and make a note to issue a TC1221
  • go back to .

Step 22

Check if the customer has provided any information to our enquiries and whether this information has been recorded in Household Notes. For how to do this use TCM1000067.

If information has been provided and is recorded in Household Notes and you have issued a TCC50, go back to .

If information has been provided and is recorded in Household Notes and you have issued a TCC50 querying the hours worked only, go to .

If information has been provided and recorded in Household Notes and you have issued a TC1221, go back to .

If there is no information recorded in Household Notes and you have issued a TCC50 querying the hours worked only

  • calculate the new hours that reflect the customer’s earnings. Use the NMW table in the Customer Advisor Guide Toolkit.
  • update ‘Change of Circumstances’ with the new hours only, do not amend income. For how to do this use TCM1000364

Note: Only change the customer’s hours if they fall outside the tolerance levels shown at the start of this guidance.

  • complete the ‘Amend Finish’ screen. For how to do this, use TCM1000032

Note: In a joint claim, ensure that both customer’s details are updated.

  • update Household Notes with the message SD78 from TCM0172020. For how to do this, use TCM1000001
  • go to .

If there is no information recorded in Household Notes and you have issued a TC1221, go to .

Step 23

Check what the customer is calling about.

Note: Verify the customer’s identity. For how to do this use TCM0094120.

If the customer is calling in response to a TC1221, go back to .

If the customer is calling in response to a TCC50, go back to .

If the customer is calling in response to a TCC50 sent to query the hours worked only, go to .

Step 24

Consider the explanation given by the customer around the hours worked.

If you did not request hours worked information on the TCC50 that you issued to the customer, go to .

If the customer explains the difference around the hours worked and you accept the explanation, go to .

If the customer explains the difference around the hours worked and you do not accept the explanation

  • calculate the new hours that reflect the customer’s earnings. Use the NMW table in the Customer Advisor Guide Toolkit.
  • update ‘Correction’ with the new hours. For how to do this use TCM1000364

Note: Only change the customer’s hours if they fall outside the tolerance levels shown at the start of this guidance.

  • complete the ‘Amend Finish’ screen. For how to do this use TCM1000032

Note: In a joint claim, ensure that both customer’s details are updated.

  • update Household Notes with the message SD72 from TCM0172020. For how to do this use TCM1000001
  • go to .

Step 25

Check if the earned income figure(s) are over the National Minimum Wage (NMW) limits. For how to do this use TCM0262080 and the NMW calculator in the Customer Advisor Guide.

Note: If the customer is providing evidence of pension contributions or gift aid payments then their income may drop below NMW but because they have provided evidence to suggest why the income should be lower we would accept this.

If the employment income for the customer is equal to or above the NMW and there are no other enquiries, go to .

If the employment income for the customer is equal to or above the NMW and you still have to issue the TCC50, go back to .

If you have received a reply from a TCC50, the employment income for the customer is equal to or above the NMW and there are no other enquires, go to .

If you have received a reply from a TC1221, the employment income for the customer is equal to or above the NMW and there are no other enquires

  • update the correction screen with the income the customer has declared. For how to do this use TCM1000016
  • update Household Notes with the message SD70 from TCM0172020. For how to do this use TCM1000001
  • take no further action.

If the employment income for the customer is below the NMW

  • make a note on a TC648 that you will need to issue a TCC50 querying the hours worked and when all your action is complete, send an email to the NMW Office using ‘National Minimum Wage, Requests RIS mailbox’.

Note: The information NMW will require is

  • Employers name and address
  • Details of the NMW issue
  • Name of customer if possible

If there is any documentation from the employer or customer indicating non-payment of NMW please attach to the email

  • go back to .

If you are dealing with an RTI Oth Incmpt, RTI Oth Dis Incmpt, RTI Oth Incmpt HB or RTI Oth Dis Incmpt HB only, go to .

Step 26

Update the Annual Declaration in Correction. For how to do this use TCM1000005.

If the customer has stated that their earned income or Other Income is zero and you have confirmed that this is correct

  • using the notes you have made, update the customer’s employed earning figure with £1 and process the Annual Declaration. For how to do this use TCM1000015

Note: In these circumstances only, in order to clear the incompatibility work list item, you will need to enter the figure of £1 in the customer’s earnings or Other Income field.

  • select ‘Yes’ to override any RTI Discrepancy or RTI Other Discrepancy error messages that may display
  • update Household Notes with the message SD73 from TCM0172020. For how to do this use TCM1000001
  • go to .

If the customer has not replied to the TC1221

  • update and process the Annual Declaration using information held on our system. For how to do this use TCM1000015.
  • select ‘Yes’ to override any RTI Discrepancy or RTI Other Discrepancy error messages that may display
  • update Household Notes with the message SD70 from TCM0172020. For how to do this use TCM1000001
  • issue a TC629 from SEES. For how to do this use TCM1000124.

If the customer has replied to the TC1221 but not provided an explanation about the income discrepancy

  • update and process the Annual Declaration using information held on our system. For how to do this use TCM1000015.
  • select ‘Yes’ to override any RTI Discrepancy or RTI Other Discrepancy error messages that may display
  • update Household Notes with the message SD70 from TCM0172020. For how to do this use TCM1000001
  • issue a TC629 from SEES. For how to do this use TCM1000124.

If the customer has replied to the TC1221 and provided a satisfactory explanation about the income discrepancy

  • from the notes you have made, update and process the Annual Declaration, for how to do this use TCM1000015
  • select ‘Yes’ to override any RTI Discrepancy or RTI Other Discrepancy error messages that may display.

Note: If the warning message asks you if you want to override an incompatible/PY-1 incompatible select ‘No’

  • update Household Notes with the message SD70 from TCM0172020. For how to do this use TCM1000001
  • issue a TC629 from SEES. For how to do this use TCM1000124.

If any other circumstances apply

Note: Follow this part of step if you have contacted the customer and confirmed that the RTI figure is correct.

  • from the notes you have made, update and process the Annual Declaration. For how to do this use TCM1000015
  • select ‘Yes’ to override any RTI Discrepancy or RTI Other Discrepancy error messages that may display.

Note: If the warning message asks you if you want to override an incompatible/PY-1 incompatible select ‘No’

  • update Household Notes with the message SD70 from TCM0172020. For how to do this use TCM1000001
  • issue a TC2001 from SEES. For how to do this use TCM1000124

Note: You must only issue the TC2001 if the customer has responded to our enquiries. If you have had no response, there is no need to issue this letter.

  • go to .

Step 27

Check if the work item is still visible on the ‘Unprocessed S17’ work list. For how to do this use TCM1000155.

If the work item is no longer visible on the ‘Unprocessed S17’ work list

  • send the correspondence to storage. For how to do this use TCM0074140
  • take no further action.

If the work item is still visible on the ‘Unprocessed S17’ work list with the ‘RTI Incompatibility’ reason, go to .

If the work item is still visible on the ‘Unprocessed S17’ work list with any other reason than ‘RTI Incompatibility’

  • transfer the work list item to the relevant MU for that work task. For how to do this use TCM0322460 for the correct MU number
  • send the correspondence to storage. For how to do this use TCM0074140
  • take no further action.

Step 28

Check if the claim is finalised. For how to do this, use TCM1000183.

If the claim is finalised

  • transfer the work list item to the ‘Unprocessed S17 phase 2 worked and cleared’ MU. For how to do this use TCM1000304. Use TCM0322460 for the correct MU number
  • send the correspondence to storage. For how to do this use TCM0074140
  • take no further action.

If the claim is not finalised

  • refer the case to your TALLO to establish why the claim has not finalised

Note: If your TALLO can establish the reason why the claim has not finalised, make the amendments as necessary to process the declaration.

  • take no further action.

Step 29

Check to see if an Appeal marker is present. For how to do this, use TCM1000366.

If there is an Appeal marker present

  • renew the claim only. For how to do this use TCM1000018

Note: If the warning message asks you if you want to override an incompatible/PY-1 incompatible select ‘No’.

  • go to .

If there is no Appeal marker present

  • manage finalise and renew the claim. For how to do this use TCM1000017

Note: If the warning message asks you if you want to override an incompatible/PY-1 incompatible select ‘No’.

  • go to .

Step 30

Check if the work item is still visible on the ‘Unprocessed S17’ work list. For how to do this use TCM1000155.

If the work item is no longer visible on the ‘Unprocessed’ S17 work list

  • send correspondence to storage. Follow the guidance in TCM0074140
  • take no further action.

If the work item is still visible on the ‘Unprocessed S17’ work list with the ‘RTI Incompatibility’ reason, go to .

If the work list item is still visible on the ‘Unprocessed S17’ work list with any other reason than RTI Incompatibility’

  • transfer the work list item to the relevant MU. For how to do this use TCM1000304. Use TCM0322460 for the correct MU number
  • send the correspondence to storage. Follow the guidance in TCM0074140
  • take no further action.