Processing Manual Follow-up (MFU) tax activities for benefit transfers 107-19061235

In the customer's record, identify why the payment summary was not issued.

A negative amount is identified in the Other Adjustments section of the Tax Detailed Explanation page:

• as a benefit transfer (BTR), go to Step 2
• as an advance recovery (RCV), see Processing Manual Follow-up (MFU) tax activities for Advance recoveries
• as a manual adjustment, see Processing Manual Follow-up (MFU) tax activities for debt processing

Identify the Benefit type(s) for the period of the benefit transfer. Note the:

• benefit types
• commencement date, and
• periods of the benefit transfer

Note: a customer may have received more than 1 benefit type in the benefit transfer period. See the Resources page for examples.

Calculate the amount of the original benefit type(s) for the period of the benefit transfer:

• this is the period that the new benefit type should have been paid

The amended original benefit type(s) amount must reflect:

• the total paid for each benefit
• less the BTR period for each benefit (as calculated above)

Use the figure(s) to correct the:

• Tax Payment Summary (TXGS), and
• Tax Payment Summary Details (TXGD) screens

Check the Payment Summary (PS) screen for the new benefit. If:

• an arrears BTR payment has been issued, go to the Payment Details (PD) screen and select [Enter]. This opens the Payment Details Component (PDC) screen that enables staff to:
• calculate the taxable, or
• reportable non-taxable components for the period of the benefit transfer
• no arrears BTR payment has been issued, go to Step 6

Do the BTR arrears cross over 2 financial years?

• Yes, go to Step 5
• No, go to Step 6

If the BTR arrears cover 2 financial years, calculate a daily rate. This will ensure each of the financial years figures are correct.

Note: calculations are based on the period that they were intended for. Not the period that they were paid/received.

To work out the daily rate:

• divide the calculated amount from Step 4, by the amount of days the BTR covers. This will provide the daily rate
• then multiply the daily rate by the number of days that fall in the relevant financial year

The new benefit amount will be:

• the benefit transfer amount as calculated in Step 3
• plus the BTR arrears (if applicable) from Step 4 or Step 5
• plus the taxable or reportable non-taxable components paid under the new benefit in the relevant period (this can be found on the TXYTD under Calculation Summary > Payments Received)
• minus any debt adjustments or Advance recoveries

Specialist Tax Details Adjustment (TXAJ) screen access is required to complete this Step.

The amounts to be amended on the TXGS screen for the:

• original benefit(s), is the amount paid, less the amount of the BTR as calculated in Step 3
• new benefit, is the amount as calculated in Step 6

Use the calculated figures to amend the TXGS/TXGD screens.

• go to the TXGS screen
• on the line to be amended, key ‘C’ > [Enter] to view the TXGD screen
• change the original and new benefit lines to the correct figure using reason 'TFR'
• complete the activity

Manual corrections are overridden when a tax calculation occurs for the same financial year.

See Safeguarding customer privacy when raising and recovering debts, before issuing the Payment summary. Take the appropriate actions to protect the customer’s privacy.

Issue the payment summary once the MFU tax activity has passed Quality On Line (QOL) checking.

To issue the payment summary:

• go to the TXGS screen and key 'I' against the line to be issued
• complete the MFU tax activity
• record details, use Fast Note - select Auto text, use Debts > Updates > Tax MFU Actioned

If the BTR crosses into the current financial year, supress the payment summary:

• go to the TXGS screen for the customer
• Suppress Auto Issue Y/N indicator set to Y

Note: this will not stop the payment summary being issued.

This will generate a MFU at the end of the current financial year. Debt Staff may need to amend tax details and reissue the payment summary to the customer.

If the benefit transfer calculations are complex:

• refer the case to an Operational Leader for further investigation
• if required, the Operational Leader will escalate