ihta84/s233.- Interest on unpaid tax.

Interest

[1975 Sch.4 para.19(1); 1976 s.83(5), Sch.11 para.3.; 1982 Sch.17 para.13.]

233. - (1) If

(a) an amount of tax charged on the value transferred by a chargeable transfer made after 5th April and before 1st October in any year and otherwise than on death remains unpaid after the end of the period ending with April in the next year, or

(b) an amount of tax charged on the value transferred by any other chargeable transfer remains unpaid after the end of the period of six months beginning with the end of the month in which the chargeable transfer was made, or

(c) an amount of tax chargeable under section 32, [32A ¹ ], 79(3) or 126 above or under Schedule 5 to this Act remains unpaid after the end of the period of six months beginning with the end of the month in which the event occasioning the charge occurs,

[then, subject to subsection (1A) below ² ] it shall carry interest from the end of that period at the rate applicable under [section 178 of the Finance Act 1989. ³ ]

[(1A) If, under section 230 above, the Board agree to accept property in satisfaction of any tax on terms that the value to be attributed to the property for the purposes of that acceptance is determined as at a date earlier than that on which the property is actually accepted, the terms may provide that the amount of tax which is satisfied by the acceptance of the property shall not carry interest under this section from that date. ⁴ ]

(2) The rate referred to in subsection (1) above is -

[(a) if the chargeable transfer was made on death or is a potentially exempt transfer, 9 per cent;

(b) in any other case, 11 per cent; ⁵ ]

[1975 Sch.4 para.19(4).]

(3) Interest payable under this section shall not be allowed as a deduction in computing any income, profits or losses for any tax purposes.

[1975 Sch.4 para.19(5).]

(4) A statutory instrument made under this section shall be subject to annulment in pursuance of a resolution of the House of Commons. ⁶

1 1985 Sch.26, para.11, in relation to events occurring after 18 March 1985.

2 1987 s.60(1), with effect from 17 March 1987.

3 1989 c.179(1)(d). Originally "subsection (2) below."

4 1987 s.60(2), with effect from 17 March 1987.

5 Amended by 1986 Sch.19, para.32, with effect from 18 March 1986 and repealed by 1989 s.187 and Sch.17, Part X with effect from an appointed day in accordance with 1989 s.178(7)(ax). Originally enacted in the Capital Transfer Tax Act 1984 as "(a) if the chargeable transfer was made on death, 6 per cent; (b) in any other case, 8 per cent; or (in either case) such rate as the Treasury may from time to time by order made by statutory instrument prescribe"(bx)

6 Repealed by 1989 s.187 and Sch.17, Part X, with effect from an appointed day in accordance with 1989 s.178(7).(ax)

(ax) By S.I 1989 No.1298, the appointed day is 18 August 1989.

(bx) See Part III Statutory Regulations etc post for statutory instruments made under this section.