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PAYE13015 | Coding: coding: general principles: work item 184 - annual coding - update IB - NIB shown (Action Guide)

From HM Revenue & Customs · PAYE Manual

Work item 184 is generated when the DWP file shows incapacity benefit to be updated but the individual’s record has state pension / benefits in the CY+1 tax code.

Note: An individual cannot receive state pension / benefits and incapacity benefit at the same time, therefore the CY+1 tax code should only contain one of these deductions.

To clear work item 184 follow steps 1 - 12 below. This guide is presented as follows

Step 1

Steps 2 - 10

Steps 11 - 12

For details of how to use any of the PAYE Service functions, access the system help.

Initial action in all cases

1. Review

  • The individual’s record on the PAYE Service

  • Indicators set on the record

  • Any relevant notes

Update the record

2. Check Contact History and other notes for information about why state pension / benefits is coded

3. Check whether the state pension / benefits coded relate to ‘Other Benefits’. Where the state pension / benefits relate to ‘Other Benefits’ you should follow the guidance at PAYE130075 and remove the state pension / benefits from the CY and CY+1 income, allowances, benefits and deductions (IABD). For information about how to enter details and submit for a code calculation refer to action guide tax80002

4. Update the annual amount of incapacity benefit for CY+1 in IABD

5. On the Code Details screen ‘Submit’ to issue the tax code

6. Update Contact History and go to steps 11 and 12

7. Where the state pension / benefits coded do not relate to ‘Other Benefits’ you should check if a P45 (IB) or a P45 (IBO) has been received. Where a P45 (IB) or a P45 (IBO) has been received CY, update the CY+1 tax code in the income, allowances, benefits and deductions (IABD) to remove the incapacity benefit deduction

  • On the Code Details screen ‘Submit’ to issue the tax code

  • Update Contact History and go to steps 11 and 12

8. Where the state pension / benefits do not relate to ‘Other Benefits’ and no P45 (IB) or P45 (IBO) has been received, issue a letter to the individual to determine which benefit is being received and the current weekly amount. Trigger the CY+1 tax code using the ‘Calculation Only’ option and do not make any changes to the amounts already held in IABD

9. On the Code Details screen ‘Submit’ to issue the tax code

10. Update Contact History and go to steps 11 and 12

Close the work item

11. Complete the work item notes

12. Close the work item