Extra Statutory Concession (ESC) A19 allows HMRC to not collect certain liabilities in respect of Income Tax and Capital Gains Tax. An unexpected tax liability will typically occur when an employer has been operating an incorrect PAYE coding.

This is a freeview 'At a glance' guide to Extra Statutory Concession (ESC) A19. 

At a glance

HMRC commenced consultations on revising the text of ESC A19 in 2012. It wanted to make it harder for taxpayers to pass the blame for coding errors back to HMRC. No changes have yet been enacted despite many years having passed.

Critics of HMRC say that the problem stems from HMRC’s apparent inability to process the data that it receives. Part of this problem is that employers submit annual returns to HMRC and so taxpayers assume that HMRC, therefore, has the information it requires to issue a correct PAYE coding. As most taxpayers do not understand their PAYE codings they automatically assume that HMRC is right. 

In some cases, taxpayers have had multiple employments in a tax year, and if they have not notified HMRC, an employer may be operating the wrong code and an underpayment of tax can arise. This should be picked up when the end-of-year returns are entered onto HMRC’s computers. In the past, it has taken HMRC many years to reconcile the position for some taxpayers. From 2017 onwards the introduction of Dynamic coding and in-year adjustments may have an impact on coding errors, although to what extent this is the case is unclear.

HMRC wants taxpayers to be more proactive about ensuring that their tax codes are right and that they have been paying the right amount of tax, and so proposed to rewrite ESC A19 to that effect.

ESC A19 

Currently, under ESC A19, arrears of Income Tax, Class 4 National Insurance and Capital Gains Tax (CGT) may be given up if they result from the failure of HMRC to make proper and timely use of the information supplied by:                     

  • A taxpayer about their own income, gains or personal circumstances.
  • An employer, if the information affects a taxpayer's coding.
  • The Department for Work and Pensions (DWP), about a taxpayer's state retirement, disability or widow's pension.

Tax will normally be given up only if the taxpayer:                     

  • Could reasonably have believed that their tax affairs were in order, and
  • Was notified of the arrears more than 12 months after the end of the tax year in which HMRC received the information indicating that more tax was due, or 
  • Was notified of an over-repayment after the end of the tax year following the year in which the repayment was made.

In exceptional circumstances arrears of tax notified 12 months or less after the end of the relevant tax year may be given up if HMRC: 

  • Failed more than once to make proper use of the facts they had been given about one source of income. 
  • Allowed the arrears to build up over two whole tax years in succession by failing to make proper and timely use of the information they had been given.

Proposed 2012 revision

HMRC’s proposed revised text for ESC A19 was subject to a 2012 consultation, it went as follows: 


Extra Statutory Concession (ESC) A19 allows HMRC to not collect underpaid Income Tax in certain circumstances. An underpayment arises when an individual has not paid the right amount of Income Tax on their earnings. 

When Extra Statutory Concession (ESC) A19 applies

An individual can request HMRC to apply ESC A19 if they believe that the underpayment has arisen because, following HMRC's receipt of information from the individual, their employer or the Department for Work and Pensions (DWP):                     

  • HMRC failed to issue a tax code. 
  • HMRC issued an incorrect tax code.
  • HMRC incorrectly repaid tax.  

For HMRC to apply ESC A19, HMRC expects taxpayers to meet their responsibilities (as set out below) and for the following two circumstances to have occurred:

  • HMRC notified the individual of the underpayment more than 12 months after the end of the tax year in which the information was received indicating that more tax was due or that the incorrect repayment was made; and,  
  • HMRC did not meet its responsibilities in dealing with information provided to them (see below for what HMRC’s responsibilities are and what counts as ‘information’).


Mr Smith underpaid Income Tax in the tax year 2021-22 because HMRC received information which it failed to deal with in that tax year. HMRC informed him of the underpayment after 5 April 2023. Subject to the responsibilities tests set out below, Mr Smith can ask HMRC to apply ESC A19.

Why an underpayment of Income Tax happens

Underpayments can arise for a number of reasons and are not always due to HMRC or taxpayer fault. Sometimes an underpayment can arise because of the use of a temporary tax code or emergency code.

Typical reasons for underpaid income tax include:                   

  • An individual or employer giving HMRC wrong information about a change in circumstances or income. 
  • An individual or employer not informing HMRC about a change of circumstances.  
  • An employer or pension payer using an emergency tax code.  
  • HMRC making a mistake when they record the information they are given.  
  • HMRC not acting on the information they are given.  

Responsibilities tests

To ensure that the right amount of tax is paid it is important that HMRC meets its responsibilities and that an individual meets theirs.

For the purposes of the proposed revision to ESC A19 and its future application, HMRC is suggesting that HMRC and the individual need to meet a series of objective responsibilities. 

HMRC's responsibilities

When HMRC receives information regarding an individual's tax affairs HMRC should:                     

  • Issue a tax code or amend the individual's tax code where they are in possession of relevant facts sent to them by an individual.
  • Accurately record and use the information provided as part of the annual PAYE reconciliation process.  

Taxpayer responsibilities

As set out in the HMRC Charter, HMRC expects individuals to take responsibility for getting things right even if they have authorised someone to act on their behalf.

HMRC expects individuals to:                     

  • Tell it about any changes in their circumstances that will affect their payments or claims.  
  • Check their tax code to ensure the information included is correct and up to date.  

Sometimes where there has been a change in personal circumstances, it might not be clear whether it has an effect on the amount of Income Tax an individual has to pay. If an individual is unsure as to whether a change of circumstance affects their tax code they should contact HMRC. 

Taxpayers should also keep a note of the date they contacted HMRC, the name of the person they spoke to and details of the change they reported and, where appropriate, provide records that support what they tell HMRC.

What counts as 'information'?

HMRC can receive information relating to a change of circumstance or income from:                     

  • An individual. 
  • An employer.  
  • The Department for Work and Pensions (DWP).  

The following and no other information will be treated as relating to a change of circumstance or income. 

From the individual

From the employer

From the Department for Work and Pensions

1. Direct communication from a taxpayer (or someone authorised to act on their behalf) informing HMRC about a change in income, allowances, benefits or personal circumstances.

1. Form P45*

2. Form P46*

3. Form P46 (Pen)*

4. Form P46 (Car)

5. Form P11D

1. Form P46 (DWP)

2. Form P46 (IB)


*or the equivalent information provided under a Real-Time Information submission

Is there a time limit for ESC A19 to apply?

Where an individual thinks ESC A19 may apply they should contact HMRC as soon as possible. This must be before the start of the tax year in which the underpaid tax will be collected through the tax code.

If the underpaid tax cannot be reflected in a change to their tax code then the individual should contact HMRC as soon as possible and in any event, before the end of the tax year in which the P800 Tax Calculation was issued. 


HMRC notifies Mrs Smith of an underpayment for the tax year 2020-21 by sending her a P800 Tax Calculation on 1 June 2022. Mrs Smith considers it was HMRC’s failure to deal with information that led to the underpaid tax.

Mrs Smith should contact HMRC as soon as possible after receiving the P800, or, upon receiving her Tax Code Notice for 2023-24, but in any case, before 6 April 2023.

If Mrs Smith fails to contact HMRC by 6 April 2023 then HMRC will not be required to look at ESC A19 after that date. Although HMRC may have contributed to the underpayment, it is still tax that is correctly due from Mrs Smith

The result of the 2012 consultation 

Following responses to the consultation HMRC concluded that, although the proposed changes were intended to bring both clarity and objectivity to the measure, it was clear that a more desirable outcome would be a more consistent application of the current form of ESC A19. As a result, no changes have yet been made to the wording of the concession.

External links

HMRC guidance: If HMRC did not act on information they were given


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