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HMRC internal manual

Debt Management and Banking Manual

Interest: Interest Review Unit (IRU): Corporation Tax (CT): Corporation Tax Assessments (CTA) pre 1 October 1993

The number of these cases is reducing. The guidance in DMBM405010General Principles should be sufficient to handle the bulk of cases coming from the periodof CTA.

One area of ‘pre 1993’ CT assessing requires particular attention when reviewing interest.When CTPF was introduced, a drafting error in the legislation effectively cancelled theapplication of ‘Section 86’ interest to these earlier assessments. This error wassubsequently found and corrected but there is a ‘window’ during which interest cannot becharged.

This window covers from 31 January 1997 until 6 March 2001 and should always have beentaken into account in the original calculation and application of an interest charge.

Where it is identified that the window has not been taken into account, calculate theamount of interest overcharged and cancel that amount.