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HMRC internal manual

VAT Default Interest Manual

Reviews and appeals: What in law may be appealed

The law relating to appeals against interest to the First-tier tribunal is contained in Section 83 of the VAT Act 1994 and states that:

‘83 (1). Subject to Section 84, an appeal shall lie to a tribunal with respect to any of the following matters -

(q) the amount of any …interest… specified in an assessment under section 76;’

The VAT Act therefore allows a taxpayer to appeal against the amount of interest charged but not against the liability to or rate of interest.

As there is no right of appeal against the imposition of interest, when writing to taxpayers you should always make it clear that they can only appeal against the amount of interest if they feel it has been calculated incorrectly.

Tribunals do not have the power to vary the amount of interest that has been assessed (Section 84(6) VAT Act refers).