VSIM7800 - Processes and procedures: affect on officers assessments liable to default interest

This guidance deals with interest matters in respect of prescribed accounting periods starting on or before 31 December 2022. Interest matters with effect from 01 January 2023 are dealt with under Finance Act 2009.

Please see Compliance Handbook page CH140000 onwards to find the new interest rules guidance.

If a taxpayer receives a payment of statutory interest (SI) the relevant over-declaration should be inhibited for default interest (section 74 VATA) purposes on the appropriate input document.

This is so that if an officers assessment is raised separately for the same accounting period the taxpayer will not benefit twice, through payment of SI and a reduction in any associated default interest.

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

VATA s 78
VATA s 74