Interest: Repayment Interest: General rule - example
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 of amounts paid to HMRC
Russell made the following two payments on account for his 2014-15 self-assessment. The payments were based on his liability for the previous year.
|Due date||Amount||Date paid||Amount paid|
|Payment on account||31 January 2015||£15,000||28 January 2015||£15,000|
|Payment on account||31 July 2015||£15,000||27 July 2015||£15,000|
When Russell submitted his self-assessment for 2014-15 his actual liability for the year was £24,000.
According to the allocation of payments rule, see CH146100, the amount we refund comes, in two equal parts, from the two payments on account. We refunded the overpayment of £6,000 on 1 March 2016.
The repayment interest that we pay is based on the information below.
|Amount on which repayment interest is payable||Period for which repayment interest is paid|
|£3,000||31 January 2015 to 1 March 2016|
|£3,000||31 July 2015 to 1 March 2016|
Here, Russell paid the payments on account a few days early, but the repayment interest start dates are the dates on which the amounts were due and payable.
Overpayment of amounts on the making of a return or claim
We haven’t’ provided an example because this general rule does not apply to any of the taxes that currently use the FA 2009 interest provisions, see CH140160.