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HMRC internal manual

Company Taxation Manual

Corporation Tax self-assessment (CTSA): the payment obligation: general

Tax liability

Companies must calculate their tax liability and pay this to HMRC by the normal due date.  This obligation arises automatically and does not depend on any action by HMRC. Payment must be made electronically.

If the company is “large”, within the meaning of The Corporation Tax (Instalment Payments) Regulations 1998, it must pay its liability in instalments for CTSA accounting periods, see CTM92500 onwards.

The company will need to make further payments if it finds that its estimate has been too low.  Also, it can claim a repayment if it later believes that the initial payment was too high, see CTM92090 and CTM92110.


Interest is chargeable on tax paid late under TMA70/S87A.  It runs from the normal due date.

Companies that are required to make quarterly instalment payments of tax are liable to interest (“debit interest”) on late and inadequate instalment payments, see CTM92650.

All companies that pay tax before it is due are entitled to interest (“credit interest”) from the Revenue, see CTM92290.

A company that makes quarterly instalment payments is entitled to credit interest only if the total amount of tax paid at a point in time exceeds the amount it was due to pay at that time, see the example at CTM92680.

Repayments of tax attract repayment interest under ICTA88/S826.  The interest runs:

  • on repayments of CT (including,  tax under CTA2010/S455 and ICTA88/S747) from the later of the normal due date and the date on which the tax was paid. (However, see CTM98245 for the complications that arise with Section 455 tax.)
  • on repayments of IT and payments of tax credit from the day after the end of the accounting period.

Group companies can, subject to certain rules, surrender overpayments between themselves with a view to avoiding or reducing the effect of the different rates of interest charged on underpayments and paid on overpayments, see CTM92440 onwards.