SAM110087 - Repayments: issue repayment: freestanding credit created manually from a ‘stand alone’ claim made after the time limit for amending the return (Schedule 1A TMA 1970)

Effective date of payment (EDP)

The EDP(s) of the freestanding credit(s) is the relevant due date of the original charge(s) which would have been reduced had it been possible to amend the SA return.

For example

  • The freestanding credit created for the relief should be given an EDP of the BCD. But where the relief exceeds the BCD amount, the amount of relief exceeding the BCD should be divided equally into two amounts and two freestanding Credits created with EDPs equal to the payments on account
  • Where only POAs exist for the year of claim, the relief should be divided equally into two amounts and two freestanding credits created with EDPs equal to the POAs
  • Where the relief exceeds the amount of any BCD and / or POAs, the excess should be treated as a BCC and a freestanding credit for this excess amount with an EDP of the fixed filing date of the year of claim

In this context, the ‘year of claim’ is the year to which the relief relates and not the year of the return on which the claim for relief is being made.

Where the original tax has been paid late, the freestanding credit(s) should replace the late payments. This will reduce the interest and surcharge accordingly. Note: Surcharge applied to tax years 2009-10 and earlier. Tax geared late filing penalties replaced surcharge for the tax years 2010-11 and later. Further guidance is available in subject ‘Claims: Made After the Time Limit’ (SAM114070).

Repayment supplement (RPS)

From

The latter of the date the tax was paid to HMRC or the date the payment became due and payable, except where the original tax has been collected through the code

This should be done on a last in first out basis

Where the original tax has been collected through the code

For years 1995-96 and earlier

  • 6 April, 12 months following the end of the tax year in which it was coded

For years 1996-97 onwards

  • 31 January following the end of the tax year in which it was coded

For the amount of relief that exceeds the total tax liability for the year of claim

  • The fixed filing date of the year of claim

Note: Where the ‘original’ tax was not paid, RPS is not payable

To

Where repayment is to be made

  • The projected date of issue of the repayment

If set off is to be made within the same UTR, to a later year

  • The relevant due date of the outstanding charge against which the credit is to be set

Note: If set off is to be made to an earlier year, no RPS will be payable

If set off is to be made against another UTR or Head of Duty

  • The date the set off is made

RPS calculated automatically or manually?

  • RPS will need to be calculated manually

Note: RPS is not calculated on the amount of the FSC but on the payment(s) that the FSC is replacing. The exception to this is where the FSC relates to an amount that would have been a BCC, in which case RPS is calculated on the FSC amount.