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HMRC internal manual

Self Assessment Claims Manual

HM Revenue & Customs
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Overpayment relief: Exclusions: Case C - Other relief out of time

See SACM12060 for how Case C applies to contract settlements.

SACM12080 explains that if there is another formal means of correcting a tax liability, the person must use this instead of claiming overpayment relief.

If a person knew, or ought reasonably to have known, that they had some other means of correcting an overpayment or over-assessment, they cannot claim overpayment relief if they failed to use those other means within the relevant time limit. The test applied under Case C is not the same as that applied in penalty cases. In refusing a claim under Case C we are not seeking to penalise the taxpayer.

The exemption is HMRC’s defence against a claim so the evidential burden will be ours. It will not be sufficient just to demonstrate that the person does not have what may be considered to be akin to a reasonable excuse for their failure. HMRC will want to be able to show that the person had behaved recklessly or deliberately.


Mr X was the subject of an employer compliance review which established he had deliberately made payments for overtime in cash and did not put these payments through the payroll. The EC review was settled with Mr X making good the PAYE and NIC (along with interest and a penalty). Mr X knew he was liable to account for PAYE and NIC but he did not declare this or record this in his accounts. His overpayment relief claim for income tax relief for the additional expense was refused under Case C.

You must judge on a case by case basis whether a person ought reasonably to have known that they

  • had made a mistake, and
  • could obtain a repayment or correct an excessive assessment.

You should not necessarily refuse overpayment relief merely because the person could have realised that they should do something about the matter sooner. You should consider whether, taking into account their ability and circumstances, the person

  • took reasonable care to ensure they paid the right amount of tax, and
  • had any reason to suppose that they might have overpaid.

Persons are not required to take advice on every aspect of their tax affairs, nor can we expect them to avoid every possible mistake. However, they should take care with their tax affairs, try to be sure of the facts and seek HMRC or independent professional advice if they have any significant uncertainty.

If a person realises that they have overpaid or that an assessment is excessive but they are uncertain what they might do about the mistake, we would normally expect them to seek advice.

We do expect a person to take note of any advice or guidance that we or their advisors have given them.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Para 2(4) Schedule 1AB TMA 1970

Para 51A(4) Schedule 18 FA 1998