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HMRC internal manual

Debt Management and Banking Manual

From
HM Revenue & Customs
Updated
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Interest: handling interest objections and enquiries: DTO action: discharging interest locally - legacy cases only

Potential discharge cases

Discharge may be appropriate in the following circumstances:

  • the amount on which interest is charged is reduced
  • the due and payable or reckonable date used proves to be incorrect
  • a postponement application was made but was not agreed or determined
  • the effective date of payment is earlier than that shown on the interest computation
  • an assessment proves to be invalid
  • the assessment does not attract interest
  • interest has been charged twice on the same payment
  • an increase to the assessment should have been dealt with by a further assessment.

Discharging interest

Where you find a interest charge is incorrect:

  • compute the revised amount payable
  • take a printout of the computation
  • check the payment position
  • proceed as below.

Discharge results in excess payment which can be reallocated within the taxpayer record

Day 1: complete either INP208 or INP209 to effect the reallocation

Day 2: check the record to ensure that the reallocation has been done, then use INP507 to discharge the interest

Day 3: take a screenprint of the revised interest charge and attach it to the AZ63 and papers. The officer who authorised the discharge (or one of the same grade or higher) should confirm the discharge has been correctly applied.

Discharge results in repayment or relocation

Day 1: use INP507 to discharge the interest

Day 2: take a screen print of the revised interest charge and attach it to the AZ63 and papers. The officer who authorised the discharge (or one of the same grade or higher) should confirm the discharge has been correctly applied

Discharge will result in repayment or set-off against a different duty type

If the revised amount of interest is less than the amount of interest paid and the excess payment is to be repaid or set-off against a different duty type send the AZ63A(New) to the Accounts Office to complete the reallocation and discharge the interest.

After 5 working days check the IRIS record to ensure that the payment has been moved and the discharge has been made, take a screenprint and link it to the papers.