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HMRC internal manual

Inheritance Tax Manual

From
HM Revenue & Customs
Updated
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Interest period: instalments without interest relief

In most circumstances instalments (IHTM30191) of tax are without interest relief, i.e. interest on the unpaid tax is added to each instalment and paid accordingly (IHTA84/S227 (3)).

Thus in the case of the first instalment interest is charged

  • on that instalment only
  • from the due date to the date of payment.However when the second instalment is assessed (

IHTM31184) interest is charged

  • on that instalment only from its due date to the date of payment (in practice, date of assessment)and

  • on the whole of the tax outstanding between the due date of the first instalment and the due date of the second (i.e. for one year).