VDIM7130 - When to inhibit, amend or withdraw interest: VAT assessments involving suspected fraud

This guidance deals with interest matters in respect of prescribed accounting periods starting on or before 31 December 2022. Interest matters with effect from 01 January 2023 are dealt with under Finance Act 2009.

Please see Compliance Handbook page CH140000 onwards to find the new interest rules guidance.

Generally interest should not be inhibited on an assessment if the case is pursued for fraud. However in cases where a best judgement assessment is issued in advance or during an investigation into behaviour, it is better to inhibit the interest until the case is concluded.

This will allow for any payments made on account during the investigation to be included manually when determining the interest charge (the interest suite is not programmed to carry out this function).