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HMRC internal manual

Compliance Handbook

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HM Revenue & Customs
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Interest: Repayment Interest: General rule

You must check whether, and from which date, the FA 2009 interest rules apply to the tax or duty you are dealing with. See CH140160 for full details.

Repayment interest runs from the repayment interest start date until the repayment interest end date.

The general rule for when HMRC pays repayment interest applies for two types of overpayment:

  1. amounts paid to HMRC and
  2. amounts not paid to HMRC but overpayment or credit because of a return or claim.

When counting the number of days for which a person is liable to repayment interest, you count the days from the repayment interest start date until the repayment interest end date. This means that an amount that if the repayment interest start date is 31 January 2013, and the amount was repaid on 1 February 2013, then the person is eligible to 1 day of repayment interest.

See CH140200 for examples of counting the number of days and CH146060 for an example of the general rule for repayment interest.

General rule for repayment of amounts paid to HMRC
General rule for overpayment of amounts on the making of a return or claim
Special provisions

General rule for repayment of amounts paid to HMRC

The repayment interest start date is the later of

  • the date on which the amount was paid to HMRC, and
  • the date on which the payment became due and payable.

This means that where a person pays a tax liability before it is due and payable, we do not pay repayment interest on any overpaid amount between the date the tax was paid and its due and payable date.

See example on CH146060.

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General rule for overpayment of amounts on the making of a return or claim

Where an amount has not been paid to HMRC but an overpayment arises, or a credit becomes due, because of a return being filed or a claim being made, then the repayment interest start date is the later of

  • the date (if any) when the return was required to be filed, or the claim to be made, and
  • the date when the return was actually filed or the claim actually made.

You won’t use this second definition of the repayment interest start date yet because it is not relevant to the taxes to which the FA 2009 interest provisions currently apply.

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Special provisions

There are special provisions that apply in particular circumstances, see CH146200+.

See CH149930 for a summary of the special provisions and CH149950 for a glossary of terms used.

FA09/S102

FA09/SCH54/PARA2
FA09/SCH54/PARA3
FA09/SCH54/PARA4
FA09/SCH54/PARA5