COM128041 - Repayments / reallocations: repayment interest non automatic calculation of RPI (Action guide)

To calculate repayment interest manually and set off against COTAX consider steps 1 - 9. The guide is presented as follows

Calculate repayment interest manually Steps 1 - 4
Set off repayment interest against COTAX Steps 5 - 9

Calculate repayment interest manually

1. Determine the CTSA material dates (Word 56KB) / CTPF material dates (Word 56KB).

2. Determine the date on which the repayment will be issued.

3. Use function RINT (Repayment Interest Calculation) to make the calculation using the following details:

  • the day after the material date
  • date on which repayment will be issued
  • the amount of the repayment.

4. Add the repayment interest to the repayment that you make or see steps 5 to 9 if you wish to set the interest off against COTAX.

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Set off repayment interest against COTAX

5. Use function VPPD (View Payments and Postings Details) to check the payment and postings record for the AP against which you intend to make the set-off. If a colleague has already made the set-off there will be a payment posting ‘PYT’ shown in Function VPPD with ‘DSO’ in the ‘Notes’ column.

6. If the set-off will make the receiving AP overpaid use function MAPS (Maintain AP Signals) and select ‘Reallocations & Repayments’ from the drop down menu for the Manual Inhibitions field. You cannot make a superseded AP overpaid.

7. Use function DSET (District Set-Off) to set off the interest. Make sure that you:

  • enter the EDP as ‘today’s’ date
  • select ‘Repayment Interest’ or ‘Repayment Supplement’ as appropriate, as the duty type being set off from the drop down menu for the Type of Set-Off field
  • allocate the amount to Interest otherwise COTAX will calculate Repayment Interest that is not due if this posting is ever repaid or reallocated at a later date.

See COM122010 for guidance on DSET codes.

8. Use function VPPD to check the results by looking for a ‘PYT’ posting endorsed ‘DSO’ in the ‘Notes’ column.

9. If you used function MAPS and selected ‘Reallocations & Repayments’ from the drop down menu for the Manual Inhibitions field at step 7 and you have since repaid or reallocated any resulting overpayment, use function MAPS to select ‘None’ from the drop down menu for the Manual Inhibitions field.