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Interest payable by the Commissioners |
| | 65. - (1) Where, due to an error on the part of the Commissioners, a person-
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(a) has paid to them by way of levy an amount which was not levy due and which they are in consequence liable to repay to him, |
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(b) has failed to claim a repayment of levy to which he was entitled, under any tax credit regulations, in respect of any tax credits, or |
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(c) has suffered delay in receiving payment of an amount due to him from them in connection with levy, |
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then, if and to the extent that they would not be liable to do so apart from this paragraph, they shall (subject to the following provisions of this paragraph) pay interest to him on that amount for the applicable period.
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(2) In sub-paragraph (1), the reference in paragraph (a) to an amount which the Commissioners are liable to repay in consequence of the making of a payment that was not due is a reference to only so much of that amount as is the subject of a claim that the Commissioners are required to satisfy or have satisfied.
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(3) In that sub-paragraph the amounts referred to in paragraph (c)-
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(a) do not include any amount payable under this paragraph; |
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(b) do not include the amount of any interest for which provision is made by virtue of paragraph 61(3)(f); but |
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(c) do include any amount due (in respect of an adjustment of overpaid interest) by way of a repayment under paragraph 86(3) or 109(3). |
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(4) The applicable period, in a case falling within sub-paragraph (1)(a), is the period-
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(a) beginning with the date on which the payment is received by the Commissioners; and |
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(b) ending with the date on which they authorise payment of the amount on which the interest is payable. |
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(5) The applicable period, in a case falling within sub-paragraph (1)(b) or (c), is the period-
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(a) beginning with the date on which, apart from the error, the Commissioners might reasonably have been expected to authorise payment of the amount on which the interest is payable; and |
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(b) ending with the date on which they in fact authorise payment of that amount. |
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(6) In determining the applicable period for the purposes of this paragraph there shall be left out of account any period by which the Commissioners' authorisation of the payment of interest is delayed by circumstances beyond their control.
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(7) The reference in sub-paragraph (6) to a period by which the Commissioners' authorisation of the payment of interest is delayed by circumstances beyond their control includes, in particular, any period which is referable to-
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(a) any unreasonable delay in the making of any claim for the payment or repayment of the amount on which interest is claimed; |
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(b) any failure by any person to provide the Commissioners- |
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(i) at or before the time of the making of a claim, or
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(ii) subsequently in response to a request for information by the Commissioners,
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with all the information required by them to enable the existence and amount of the claimant's entitlement to a payment or repayment, and to interest on that payment or repayment, to be determined; and |
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(c) the making, as part of or in association with any claim for the payment or repayment of the amount on which interest is claimed, of a claim to anything to which the claimant was not entitled. |
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(8) In determining for the purposes of sub-paragraph (7) whether any period of delay is referable to a failure by any person to provide information in response to a request by the Commissioners, there shall be taken to be so referable, except so far as may be provided for by regulations, any period which-
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(a) begins with the date on which the Commissioners require that person to provide information which they reasonably consider relevant to the matter to be determined; and |
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(b) ends with the earliest date on which it would be reasonable for the Commissioners to conclude- |
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(i) that they have received a complete answer to their request for information;
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(ii) that they have received all that they need in answer to that request; or
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(iii) that it is unnecessary for them to be provided with any information in answer to that request.
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(9) The Commissioners shall not be liable to pay interest under this paragraph except on the making of a claim for that purpose.
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(10) A claim under this paragraph must be in writing and must be made not more than three years after the end of the applicable period to which it relates.
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(11) References in this paragraph-
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(a) to receiving payment of any amount from the Commissioners, or |
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(b) to the authorisation by the Commissioners of the payment of any amount, |
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include references to the discharge by way of set-off (whether in accordance with regulations under paragraph 72 or 73 or otherwise) of the Commissioners' liability to pay that amount.
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(12) Interest under this paragraph shall be payable at the rate applicable under section 197 of the Finance Act 1996.
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Assessment for excessive repayment |
| | 66. - (1) Where-
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(a) any amount has been paid at any time to any person by way of a repayment of levy, and |
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(b) the amount paid exceeded the amount which the Commissioners were liable at that time to repay to that person, |
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the Commissioners may, to the best of their judgement, assess the excess paid to that person and notify it to him.
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(2) Where-
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(a) any amount has been paid to any person by way of repayment of levy, |
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(b) the repayment is in respect of a tax credit the entitlement to which arose in a case falling within paragraph 61(1)(f) (tax credit where all or part of a debt is bad), |
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(c) the whole or any part of the credit is withdrawn on account of any part of the debt taken as bad falling to be regarded as not having been bad, and |
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(d) the amount paid exceeded the amount which the Commissioners would have been liable to repay to that person had that withdrawal been taken into account, |
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the Commissioners may, to the best of their judgement, assess the excess paid to that person and notify it to him.
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(3) Where any person is liable to pay any amount to the Commissioners in pursuance of an obligation imposed by virtue of paragraph 64(4)(a), the Commissioners may, to the best of their judgement, assess the amount due from that person and notify it to him.
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(4) Subject to sub-paragraph (5), where-
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(a) an assessment is made on any person under this paragraph in respect of a repayment of levy made in relation to any accounting period, and |
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(b) the Commissioners have power under Part VII of this Schedule to make an assessment on that person to an amount of levy due from that person for that period, |
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the assessments may be combined and notified to him as one assessment.
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(5) A notice of a combined assessment under sub-paragraph (4) must separately identify the amount being assessed in respect of repayments of levy.
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Assessment for overpayments of interest |
| | 67. Where-
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(a) any amount has been paid to any person by way of interest under paragraph 65, but |
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(b) that person was not entitled to that amount under that paragraph, |
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the Commissioners may, to the best of their judgement, assess the amount so paid to which that person was not entitled and notify it to him.
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Assessments under paragraphs 66 and 67 |
| | 68. - (1) An assessment under paragraph 66 or 67 shall not be made more than two years after the time when evidence of facts sufficient in the opinion of the Commissioners to justify the making of the assessment comes to the knowledge of the Commissioners.
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(2) Where an amount has been assessed and notified to any person under paragraph 66 or 67, it shall be recoverable as if it were levy due from him.
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(3) Sub-paragraph (2) does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.
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Interest on amounts assessed |
| | 69. - (1) Where an assessment is made under paragraph 66 or 67, the whole of the amount assessed shall carry interest, for the period specified in sub-paragraph (2), as follows-
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(a) so much of that amount as represents the amount of a tax credit claimed by a person who was not entitled to it (but not any amount assessed under paragraph 66(2)) shall carry penalty interest; |
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(b) so much of that amount as does not carry penalty interest under paragraph (a) shall carry interest at the rate applicable under section 197 of the Finance Act 1996. |
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(2) That period is the period which-
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(a) begins with the day after that on which the person is notified of the assessment; and |
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(b) ends with the day before that on which payment is made of the amount assessed. |
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(3) Interest under this paragraph shall be paid without any deduction of income tax.
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(4) Penalty interest under this paragraph shall be compound interest calculated-
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(a) at the penalty rate, and |
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(5) For this purpose the penalty rate is the rate found by-
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(a) taking the rate applicable under section 197 of the Finance Act 1996 for the purposes of sub-paragraph (1)(b); and |
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(b) adding 10 percentage points to that rate. |
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(6) Where a person is liable under this paragraph to pay any penalty interest, the Commissioners or, on appeal, an appeal tribunal may reduce the amount payable to such amount (including nil) as they think proper.
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(7) Subject to sub-paragraph (8), where the person concerned satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the conduct giving rise to the liability to pay penalty interest, that is a matter which (among other things) may be taken into account under sub-paragraph (6).
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(8) In determining whether there is a reasonable excuse for the purposes of sub-paragraph (7), no account shall be taken of any of the following matters, that is to say-
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(a) the insufficiency of the funds available to any person for paying any levy due or for paying the amount of the interest; |
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(b) the fact that there has, in the case in question or in that case taken with any other cases, been no or no significant loss of levy; |
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(c) the fact that the person liable to pay the interest or a person acting on his behalf has acted in good faith. |
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(9) In the case of interest reduced by the Commissioners under sub-paragraph (6) an appeal tribunal, on an appeal relating to the interest, may cancel the whole or any part of the reduction made by the Commissioners.
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Assessments to interest under paragraph 69 |
| | 70. - (1) Where any person is liable to interest under paragraph 69 the Commissioners may assess the amount due by way of interest and notify it to him accordingly.
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(2) Without prejudice to the power to make assessments under this paragraph for later periods, the interest to which an assessment under this paragraph may relate shall be confined to interest for a period of no more than two years ending with the time when the assessment under this paragraph is made.
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(3) Where an amount has been assessed and notified to any person under this paragraph it shall be recoverable as if it were levy due from him.
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(4) Sub-paragraph (3) does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.
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(5) Where an assessment is made under this paragraph to an amount of interest under paragraph 69-
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(a) the notice of assessment shall specify a date, not later than the date of the notice of assessment, to which the amount of interest which is assessed is calculated; and |
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(b) if the interest continues to accrue after that date, a further assessment or further assessments may be made under this paragraph in respect of the amounts so accruing. |
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(6) Where-
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(a) an assessment to interest is made specifying a date for the purposes of sub-paragraph (5)(a), and |
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(b) within such period as may for the purposes of this sub-paragraph have been notified by the Commissioners to the person liable for the interest, the amount on which the interest is payable is paid, |
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that amount shall be deemed for the purposes of any further liability to interest to have been paid on the specified date.
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