PAYE80037 - PAYE operation: review of claims and deductions: RAR (Action Guide)

Where a claim for retirement annuity relief (RAR) is received in a letter or a form P810 and shows either a first claim or an increase of £2,500 or more (provided this is an increase of at least 10 per cent), follow steps 1 - 7 below, as appropriate. This guide is presented as follows.

Initial action

Steps 1 - 3

Reply received

Steps 4 - 7

Initial action

1. Where the first claim received in a letter exceeds £2,500 or the claim received indicates an increase in payment of £2,500 or more, write to the customer and ask for evidence of payment. Explain to the customer that the information is needed to support the claim and if we receive no reply the claim will not be allowed

2. Make a Contact History note to record the request for evidence to support the claim

3. Do not amend the code

Reply received

4. If you are satisfied with the evidence provided

  • Review liability for CY-1
  • If a tax calculation is required include the customer service message ‘P810 claim agreed as’ available from SEES Office Clerical Assistant, or where the claim was received in a letter, add the note ‘RAR claim agreed as’
  • If a tax calculation is not required, write to the customer and thank them for their co-operation and advise them that a calculation will not be issued

  • Amend the CY / CY+1 codes. Where the individual is liable at the Scottish or Welsh rates of tax, the tax adjustment will use the appropriate Scottish or Welsh rate based on the individual’s highest rate of tax. The tax code will include an S (Scottish) or C (Welsh) prefix to indicate the individual is a Scottish or Welsh taxpayer.

  • Make a note in Contact History note ‘P810 claim agreed as’ available from the SEES Office Clerical Assistant, or where the claim was received in a letter, add the note ‘RAR claim agreed as’
  • Ensure that the ‘Allowance Cessation Date’ is recorded in IABD

5. If you disagree with the information provided

  • Write to the customer and advise them
  • Of the RAR due (include an explanation to show how you arrived at the amount) and your intention to issue an informal calculation for CY-1 and to amend the CY coding
    And that
  • These will be issued in 30 days unless you hear from them further. You should also advise the customer that if they disagree, it will be necessary to issue a tax return. HMRC may then consider opening an enquiry into the completed return to challenge the figures disagreed with. If we do that they will be able to appeal against our conclusions and any additional tax that became due
  • Create a paper BF (PAYE105520) for 8 weeks
  • Make a note in Contact History ‘P810 claim not allowed / revised amount’ available from SEES Office Clerical Assistant, or where the claim was received in a letter, add the note ‘RAR not agreed / revised amount’

6. If the customer does not respond by the BF date assume agreement and

  • Issue an informal calculation for CY-1

  • Amend the CY / CY+1 codes. Where the individual is liable to Scottish or Welsh tax, the tax adjustment will use the appropriate Scottish or Welsh rate based on the individual’s highest rate of tax. The tax code will include an S (Scottish) or C (Welsh) prefix to indicate the individual is a Scottish or Welsh taxpayer.

  • Calculate the tax adjustment in favour of HMRC or the customer and record this for inclusion on the monthly LOMR report ‘Claims / Non SA Enquiries’

7. If the customer disagrees

  • Write to customer to explain that a Self Assessment return will be issued as this gives the customer the avenue to appeal
  • Set up the case in ITSA (or reactivate any dormant ITSA record) and issue a return for CY-1
  • Make a note in Contact History ‘Non return - P810 RAR query’, or where the claim was received in a letter add the note ‘Non return - RAR query’ and note action taken
  • Do not amend the code