CFM98550 - Interest restriction: administration: reporting requirements: correction of return by HMRC

TIOPA10/SCH7A/PARA28

TIOPA10/SCH7A/PARA28 provides a power for HMRC to correct an error in an interest restriction return. This is similar to the power in relation to a company tax return in FA98/SCH18/PARA16.

This power may be used to correct obvious errors or omissions in the interest restriction return or anything else in the return that HMRC has reason to be incorrect in the light of available information, but where HMRC considers that an enquiry into an interest restriction return is unnecessary. 

The correction is made by notice to the reporting company and must be made within nine months of submission of the return.

The correction can be overridden by the reporting company by:

• Revising the return so as to reject the correction; or

• By giving notice of rejection of the correction to HMRC where it is more than thirty-six months after the end of the period of account (the normal time limit in for submitting a revised return under TIOPA10/SCH7A/ PARA8(3)(a)) but within three months of the issue of the notice of correction.

If HMRC considers that the company should not have rejected the correction, it can pursue the matter by opening an enquiry.