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HMRC internal manual

Self Assessment Claims Manual

Overpayment relief: Overview

A person can claim overpayment relief to recover overpaid income tax, CGT, Class 4 NIC or corporation tax or to reduce an excessive assessment. From 31 August 2010 a person can claim overpayment relief to recover overpaid bank payroll tax or to reduce an excessive assessment.

This includes amounts paid under a contract settlement.

This guidance covers both overpayments and excessive assessments. It deals specifically with income tax and CGT but also covers CT and bank payroll tax unless otherwise indicated.

The rules for overpayment relief are intended to

* give a single route for persons to recover overpayments
* bring the claims process into line with self-assessment claims and
* align time limits with those for other claims.

Overpayment relief applies from 1 April 2010 for all tax years.

The person must make the overpayment relief claim within four years of the end of the relevant tax year or accounting period.

There are transitional rules giving a longer time limit for income tax SA returns for the years 2004-5 and 2005-6.

The claim must be in the correct form and must state the amount that the person believes they have overpaid.

The person applying for overpayment relief must make a claim to HMRC for the repayment or discharge of the amount of tax which they believe they should not have paid, or should not be due. Any existing self-assessment should be left unchanged.

There are specific situations where overpayment relief is not available. These exclusions are listed in the legislation. For example, a person can only claim overpayment relief if they have not had a reasonable chance to correct their tax liability any other way, by making or amending a self-assessment return or appealing against an HMRC assessment or amendment of their return, see SACM12070.

As far as possible, disputes relating to overpayment claims are dealt with through the tribunal rather than by claims directly to the High Court. A taxpayer cannot appeal HMRC’s refusal to accept a late claim (see SACM10030). The only challenge available to the taxpayer is Judicial Review (see ARTG12000).

Overpayment relief replaces the old error or mistake rules for individuals, partnerships and companies. From 1 April 2010, it is not possible to make a claim for the old error or mistake relief for any period. If, exceptionally, you need to refer to the old guidance for error or mistake relief see SACMApp1.

Section 100 and Schedule 52 FA 2009

Para 1 Schedule 1AB TMA 1970

Para 51(1) Schedule 18 FA 1998, as amended


Para 2 Schedule 1AB TMA 1970

Para 51A Schedule 18 FA 1998