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HMRC internal manual

Company Taxation Manual

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

Any repayment of tax paid for an accounting period ending after 30 September 1993 will potentially attract repayment interest under ICTA88/S826.  Repayment interest is paid on all repayments regardless of the place of residence of the recipient company.  However, the repayment must relate to a period (an accounting period) for which the company is within the charge to CT.

Section 826 provides for interest on tax overpaid to be paid from the normal due date (or date of payment if later) to the date on which the order for the repayment is issued.

Section 826 also applies to repayments of income tax and payments of tax credit. 

Repayment interest on income tax suffered at source is payable from the day after the end of the accounting period to the date on which the order for the repayment is issued.

Repayment interest on Research & Development, Land Remediation and Tax Credits, is payable from the later of:

  • the statutory filing date of the return or amended return for the AP for which credit is claimed
  • the date on which the return or amended return containing the claim is delivered

to the date on which the order for the repayment is issued.

See:

  • COM125090 for guidance on calculating repayment interest
  • CTM98245 for guidance on repayment interest on repayments under CTA2010/S458
  • COM120000 onwards for guidance on how COTAX deals with repayment interest.