To settle, or not to settle....

[DDoyle]

Interest on Interest?

First post so please go gentle

I received APN's for two years and have paid these (partly through obtaining a personal loan) - I would like to clear things altogether. I received an offer of settlement through and the only remaining amount to pay is the interest - around £4000.

I am unable to pay this amount now and wish to pay over 6-9 months. HMRC would like me to detail why I cannot pay and will then look into the details. On the phone they stated they would need further details of the household income etc, which seems rather heavy handed considering the amount.

My question at this stage is whether if HMRC are unwilling to be reasonable on repayment terms on the interest, and I decide not to accept the settlement, what the likely implications are? My understanding is this:

1) I've paid the calculated income tax that would be due if HMRC were successful in court.
2) The interest liable cannot be increased further - HMRC cannot charge interest on interest according to this

So though I would be keen to settle, I'm now wondering if there is any issue in fact in just not settling - the £4000 can be paid whenever HMRC eventually get a court result.... it won't increase.

Maybe I'm reading this all wrong though.

Thanks.

David.

[DonkeyRhubarb]

2) The interest liable cannot be increased further - HMRC cannot charge interest on interest according to this

So though I would be keen to settle, I'm now wondering if there is any issue in fact in just not settling - the £4000 can be paid whenever HMRC eventually get a court result.... it won't increase.

Correct.

If you've paid the APNs, no further interest will be added.