Our client had a SA liability for 2011-12 of £800, give or take.
His 2011-12 tax return was filed online before 30 December 2012
On that return he elected to pay the tax by PAYE coding restriction in 2013-14.
He has loads of PAYE income and easily fulfils the criteria to enable this.
On processing the SA return for 2011-12, HMRC accepted this treatment.
However they totally forgot to issue a PAYE coding restriction in 2013-14.
Not to worry, our client was required to file an SA return for 2013-14.
On it we included an adjustment for tax due from earlier years, despite that no PAYE code had been issued to collect it.
But the resulting SA self assessment was correct.
Now, what do HMRC do?
They issue a s.9ZB amendment to the 2013-14 self assessment to reduce the prior year underpayment to zero, having noticed that there was no PAYE code adjustment in 2013-14 and forgotten about 2011-12.
Being honest, we 'fess up and advise them that they cocked up and that the original SA was correct. They say that they will go away and have another think.
Now what do HMRC do?
They insist that they were correct to amend the 2013-14 SA return, because as a question of fact there was no PAYE code issued in 2013-14 to collect the 2011-12 tax,and that is what the tax return requires.
Instead they have released for collection the original 2011-12 underpayment, together with an interest charge running from 31 January 2013!!
With Kind regards
(PS no question, just rant)