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HMRC internal manual

Inheritance Tax Manual

HM Revenue & Customs
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Assessing: other repayment issues: provisional repayments


  • it appears that tax has been overpaid, but
  • the case is not ready for final calculation

you should always consider making a provisional repayment, even if the taxpayer or agent has not specifically asked for one.

When considering whether we should make a provisional repayment, you should weigh up:

  • the fact that it is undesirable for us to keep money on deposit that is substantially more than the expected liability, with.
  • the need to make sure that the interests of HMRC are not prejudiced.

The taxpayer or agent will usually ask for, or should be offered an interim repayment, where:

  • We have agreed an amendment, deduction or allowance, which by itself would lead to a repayment. But, other matters that may affect the tax amount of payable are still open.
  • We have agreed in principle that an amendment that would result in a substantial repayment is due, but the exact amount has not yet been quantified; and the taxpayer or agent has asked for a repayment.
  • The taxpayer or agent has overpaid tax on delivery of the IHT400, because:

    • they made a mistake about the facts
    • they did not deduct a relief or exemption that was due
    • they made a substantial arithmetical error.

If you think that a provisional repayment should be made you should speak to your manager.

Provisional repayment not appropriate

You should not normally issue a provisional repayment where the amendment has not been

  • established in principle. or
  • quantified in amount.

Again, consult your manager if the taxpayer or agent asks for a provisional repayment, but you do not consider it is appropriate.