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HMRC internal manual

Self Assessment Manual

Repayments: recover over-repayment: over-repayments: recovery by assessment

An over-repayment should be recovered by formal assessment where

  • The over-repayment relates to an amount of tax only that cannot be pursued by the SA accounting system (see subject ‘Over-repayments: Recovery by the SA System’ (SAM112030))


  • DRIER recovery procedures have proved unsuccessful (see subject ‘Over-repayments: Recovery by the DRIER Procedures’ (SAM112020))

Where the over-repayment refers to an amount of money, not tax or is a combination of money and tax, or has been repaid to a charity, recovery by formal assessment is not appropriate.

Note: An over-repayment of money could arise in the following circumstances

  • A taxpayer has paid £100 tax in total that is due to be repaid but the repayment is issued for £1,000 in error. The excess of £900 is an over-repayment of money
  • Taxpayer (B) pays £500 tax which is incorrectly allocated against the record of taxpayer (A) which becomes overpaid and a repayment is issued. The repayment is an over-repayment of money because taxpayer (A) never paid the original amount of tax that caused the overpayment

Where a formal assessment is required to recover an over-repayment, the Miscellaneous Charges Unit should request that the relevant office responsible for the processing work issue the appropriate assessment and notify the identifying office of the details.

On receipt of the details from the office responsible for the processing work, the identifying office should

  • Use function CREATE REVENUE ASSESSMENT to enter the assessment as a ‘stand alone’ charge on the SA record for the relevant year


  • Immediately use function AMEND RELEVANT DATES to amend the due date of payment to 30 days after issue of the assessment

More detailed advice on making an assessment is provided in the business area ‘Assessments’.

The original over-repayment is not regarded as interest bearing by the SA system and therefore does not attract late payment interest (LPI). However once a formal assessment has been raised for the over-repayment, LPI becomes chargeable on the assessment.

Note: Remember that if the over-repayment has arisen through HMRC error, then interest should not be pursued.

Late payment interest is charged by the SA system on assessments entered as stand alone charges on the SA record.

For Section 29 and 30 (TMA1970) assessments, the date from which LPI should be charged is 31s t January following the end of the relevant tax year.

Any interest objections arising in over-repayment cases should be submitted to the Interest Review Unit within the relevant Banking Operations office for them to deal with. The Interest Review Units experience in dealing with interest objection cases will ensure consistency of treatment.