Commentary

V7.289 Interest paid by HMRC on errors and late payments

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.289 Interest paid by HMRC on errors and late payments

Part V7 Tax planning | Commentary

V7.289 Interest paid by HMRC on errors and late payments

A business is entitled to repayment supplement where HMRC does not make any repayment due within a specified time. However, as a general principle, HMRC does not pay interest to a taxpayer on any amounts of overpaid tax, unless it (HMRC) caused the error – see Example 5.

Example 5

ABC Ltd received a ruling from HMRC in 2010 that it could not reclaim input tax on the costs of the staff Christmas party. The director of ABC Ltd has now discovered that this ruling was incorrect, and that the company could

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