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HMRC internal manual

COTAX Manual

From
HM Revenue & Customs
Updated
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Interest: interest objections and amendments: amending an interest charge

Following a review of an interest objection you may find that interest has been under or overcharged.

Where interest has been undercharged, the interest must be increased and collection of the resulting liability pursued.

Where interest has been overcharged, the interest must be decreased by discharging some or all of the original interest charge.

You should note that where the responsible office makes an informal discharge in an investigation case using function RINF (Record Informal Discharge), COTAX automatically:

  • ignores any interest accrued but not yet charged
  • discharges tax and any associated interest charged.

The clerical decrease of an interest charge requires authorisation.

In Banking Operations, authority to amend interest rests with a Senior Officer, a Higher Officer or an Officer.

In the Debt Management Office, the action to be taken when discharge of interest has been authorised by the manager depends on:

  • the underlying reason for the interest being incorrect
  • the state of the record at the time the interest is corrected.

The factors affecting the state of the record which need to be considered are whether:

  • interest or part of it, has been remitted
  • the clerical interest indicator (CII) is set to ‘Y’
  • inhibit reallocations and repayments signals are set.

See:

  • COM82021 for a list of forms relevant to this subject
  • COM82022 for a list of functions to use in particular situations.