COM125050 - Repayments / reallocations: non automatic repayments: early repayment CT Pay & File APs - responsible office
A company that pays CT and later believes that it has paid too much can, after the normal due date (Word 49KB), claim a repayment of the excess under S10(3) ICTA 1988 for a CT Pay and File AP. (Before the normal due date, any tax that has been paid early is repayable without pre-conditions).
Claims can only be made when
- An assessment has not yet been made for the AP
Or
- An assessment has been made but it is not yet final
The company must give notice of the claim to the Inspector stating
- The amount that it considers should be repaid
And
- The grounds for believing that the amount paid exceeds the company's probable liability to CT
You should consider the claim to repayment on its merits. If the company has
- Not yet made a return and a return is due
-
- Establish why the return cannot be made
- Made a return but the figures do not agree with the claim for repayment
-
- Ask the company for information to satisfy you that the repayment is due
- Been assessed but the assessment is not final
-
- Ask the company for information to satisfy you that the repayment is due
Note: If you make a repayment before an appeal or investigation is concluded, you should warn the company that it might have to repay some of the repayment when it is concluded and interest may be due on any amounts over-repaid.
Decisions on claims
S10(4) ICTA 1988
You treat repayment applications made in conjunction with an appeal against an assessment as you would postponement applications made under S55 TMA 1970 (see Assessment Procedures (AP) Manual at AP3328). If you cannot reach agreement with the company, the company may refer the claim to the Tribunal (Word 34KB) for determination.
Interaction of S10(5) ICTA 1988 / S55(3) or (4) TMA 1970
Claims for repayment under S10(4) ICTA 1988 relate only to payments made before an assessment for an AP has been made.
Payments made after an assessment has been made (but before it becomes final) can normally only be repaid when a company successfully applies for a (further) postponement under S55 TMA 1970.
S10(5) ICTA 1988
A company that has made a payment both before and after an assessment is made might want to
- Apply for a repayment under S10(4) ICTA 1988
And
- Make a postponement application under S55 TMA 1970
In practice, you should regard any application made under Section 10 at a time when an assessment is under appeal as a postponement application. Similarly, you should regard any postponement application that is intended to lead to a repayment as implying any necessary application under Section 10.
For more information see Company Taxation Manual CTM92100.
The computer normally calculates any repayment interest (Word 80KB) due on repayments of tax and automatically adds it to the repayment amount. It does not add repayment interest to any repayment made before there is a charge on the record.
For a list of forms relevant to this subject, see COM125051.
For a list of functions to use in particular situations, see COM125052.
For legislation applying to this subject, see COM125053.
