DMBM402030 - Interest: Charging interest - by IT system: Charging interest in SAFE: Automatic calculation and amendment of an interest charge

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An interest charge may be automatically amended in the following circumstances

  • A previously cleared charge is amended (decreased).
  • A payment is reallocated from a previously cleared charge.
  • A payment on a previously cleared charge is returned (Dishonoured).

An interest charge will not be automatically amended in the following circumstances

  • The Interest Exception signal (known as an Interest Lock in SAFE) has been set at Customer Account level.
  • The Inhibit Interest signal (known as an Interest Lock in SAFE) has been set at Individual Charge level.

Automatic calculation and amendment of interest

In any of the three circumstances described above where an interest charge may beautomatically amended the system will carry out the following processes –

  • All payments allocated to the tax/duty charge are moved to the Unallocated Payments suspense account.
  • Any payments allocated to the related interest charge are moved to the Unallocated Payments suspense account.
  • The interest charge is reduced to zero.
  • Once payments have been moved to the Unallocated Payments suspense account the charge amendment will be applied.
  • The auto clearing process in SAFE will return payments previously allocated to the charge/duty, sufficient to clear the revised charge and re-calculate the interest
    • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
    • Any payment previously allocated against the original interest charge will be allocated to the revised interest charge
    • Where the original interest charge was not paid any excess payment that arises following a charge amendment will be allocated against the interest charge
    • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
    • An amended charge notification will only be issued for the revised interest charge if interest remains unpaid.

    Interest Exception and Inhibit Interest signals

    Where either of these signals is set an existing interest charge will not be revisedautomatically. Following the successful processing of a charge amendment and the revisedcharge being cleared by any payments held in Unallocated Payments, an entry will appear onthe Clerical Interest worklist. This list is known as the Worklist for Interest Payments.