INTM489235 - The Unassessed Transfer Pricing Profits Process: Payment and Interest

UTPP will apply to accounting periods beginning on or after 1 January 2026.  This guidance will be updated with detailed examples by 1 January 2026.  For earlier accounting periods please use the diverted profits tax guidance at INTM489500


Payment

If the designated officer decides to make an assessment, then a charge will need to be raised on the Strategic Accounting Framework Environment (SAFE) by the Diverted Profits Unit (DP Unit).  

This should be organised by the case team at the start of the UTPP governance process to give the DP Unit ample notice. The DP Unit contact list is maintained here in INTM489355. Any amendment to the assessment should also be dealt with through SAFE.

The assessment creates a formal liability for the company to pay the full corporation tax charge from the relevant date for that accounting period. There is no provision for postponement except under S217K (see INTM489245) and the charge, at this stage, is not appealable.

Interest

Unassessed transfer pricing profits are within the charge to corporation tax. Interest is therefore charged as per TMA70/S87A which specifies that interest on overdue corporation tax is calculated from the date when the tax is due and payable until the payment date using rates specified in S178 FA1989.

For UTPP purposes, the date on which the tax was due and payable is the relevant date set out in regulations made under TMA70/S59D for the accounting period in which the company’s profit did not wholly reflect the transfer pricing requirement, as set out in S217B.

Interest will need to be imputed as part of the SAFE charge because it isn’t calculated automatically.

No repayment

In other circumstances, a company can make a claim under TMA70/S59E or S59DA on the basis that it has paid an amount of corporation tax for an accounting period, and the circumstances of the company have changed so that the company has grounds for believing that the amount paid exceeds its probable liability although that liability has not been finally established.

S217Q specifies that no claim under TMA70/S59E or S59DA is allowed for repayment of corporation tax paid on unassessed transfer pricing profits assessed at the UTPP rate.

Exclusion of reliefs, deductions and set offs

No relief, deduction or set off is allowed against unassessed transfer pricing profits which have been assessed at the UTPP rate, or the corporation tax charged at the UTPP rate.