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HMRC internal manual

International Manual

Double Taxation Applications and Claims: repayment interest: How repayment interest is calculated on a 12 month accounting period

Examples

Example 1 - Claim from a company in France

We received a claim on 6 October 2011 for repayment of the UK income tax deducted from interest paid on 30 November 2009. The French company received the interest in its accounting period 1 January 2009 to 31 December 2009. We repaid the tax on 5 December 2011.

Repayment interest is due

  • from 1 January 2010, the day after the end of the accounting period
  • to 5 December 2011, the date we issued the repayment.

Example 2 - Claim from a company in the Netherlands

We received a claim on 5 January 2012 for repayment of the UK income tax deducted from interest paid on 11 October 2006. The Netherlands company received the interest in its accounting period 1 November 2005 to 31 October 2006. We repaid the tax on 12 January 2012.

Repayment interest is due from 1 November 2006, the day after the end of the accounting period, to 12 January 2012 the date we issued the repayment.

This example shows that the date we receive the claim does not matter when calculating repayment interest.