EM3266 - Discovery: contents: recovery of overpayment of tax

S30 TMA 1970 and Paragraph 52 Schedule 18 FA 98 allow an officer to make an assessment to recover a repayment of tax that is excessive due to HMRC error.

An assessment to recover:

• excessive repayments of tax for an accounting period, or
• interest on repayments,

is treated as an assessment to tax for that year of assessment/accounting period.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

For more guidance on this matter, see DMBM215180 and DMBM215190.

S29 TMA 1970 should be used if the overpayment has occurred due to a taxpayer inflating expenses or the amount of Income Tax they have already paid.

Interest

Amounts charged in assessments carry interest under TMA70/S87A from the date on which the repayment being recovered was made until the date of payment.

Time limit

The time limits for making assessments apply to making an assessment to recover overpayment of tax.

The time limit is the latest of:

• four years after the end of the accounting period to which it relates
• the year of assessment/end of the accounting period following that in which the amount being recovered was paid
• three months after the completion of an enquiry into a relevant company tax return
• when the enquiry is completed into an individual’s tax return

This time limit does not overrule the extended time limits, set out at EM3214 and EM3215, for making an assessment in the case of loss of tax brought about carelessly or deliberately.