Reply to: HMRC steal interest on early CT payment

[JohntheBike]

Nope course it's not worth worrying about in terms of the value - HMRC just hack me off with this behaviour. You can be sure if I owed *them* interest, no matter how low the value, they'd be onto me.

They did it to me a couple of years ago with a paterntity leave credit which they refused to honour which was about 250 quid - ever since then I've been sensitive to it.

I requested that the incentive for online filing be paid in cash to MyCo. It never was, but it's one entry in my Bismark file. But there again, I guess HMRC have been warned off me and I've never had any arguments with them since where I could bring this up.

[jamesbrown]

I always question my accountant (especially after what you said about this) but what she said is actually reflected in my online account - the amount was written off.

Sounds like it's not a consistent policy though - don't know if that's worse or better.

Your HMRC online account? Curious. Although I wouldn't necessarily interpret absence as written off (i.e. how did you observe the process of HMRC writing this off?). It will probably cost you more to wait inline on the HMRC helpline than the amount you're talking about though

[rectifier]

Like I said in the post that you were responding to, that isn't my experience (also for small amounts). My experience is that it's carried over more than one year. Who did you speak to? If it's your accountant, I'd suggest that they have form.

I always question my accountant (especially after what you said about this) but what she said is actually reflected in my online account - the amount was written off.

Sounds like it's not a consistent policy though - don't know if that's worse or better.

[jamesbrown]

I got an answer about this in the end - you're right my accountant was partially incorrect about this.

Any interest payment does come off your CT bill from the following year no matter how small.

However, if you accrue interest below a certain amount, and then DO NOT reduce your CT payment by this amount the immediate year following, then it is written off as a "permanent overpayment". So my small interest payment owed from 2017 had been written off.

As I said earlier in the thread this is a trivial sum of money, but given that the procedure obviously exists to carry balances forward, it's annoying behaviour. No reason why it can't be carried forward more than a year.

Like I said in the post that you were responding to, that isn't my experience (also for small amounts). My experience is that it's carried over more than one year. Who did you speak to? If it's your accountant, I'd suggest that they have form.

[rectifier]

Your accountant is giving you false information. It does roll forward. Indefinitely AFAIK. For example, the year before last, I had less than five quid in interest for the few days it was sitting with them before the deadline, and that rolled forward to last year, and the same again this year, at which point I paid the CT600 figure for this year minus the accrued interest, rather than letting it roll forward again. So they will roll forward even a few quid.

I got an answer about this in the end - you're right my accountant was partially incorrect about this.

Any interest payment does come off your CT bill from the following year no matter how small.

However, if you accrue interest below a certain amount, and then DO NOT reduce your CT payment by this amount the immediate year following, then it is written off as a "permanent overpayment". So my small interest payment owed from 2017 had been written off.

As I said earlier in the thread this is a trivial sum of money, but given that the procedure obviously exists to carry balances forward, it's annoying behaviour. No reason why it can't be carried forward more than a year.

[jamesbrown]

That's exactly what I asked my accountant - why doesn't it just roll forward... But no, less than a certain amount and it is written off / stolen.

However, this thread has finally pushed me into action to open an Aldermore account so that's a result.

Your accountant is giving you false information. It does roll forward. Indefinitely AFAIK. For example, the year before last, I had less than five quid in interest for the few days it was sitting with them before the deadline, and that rolled forward to last year, and the same again this year, at which point I paid the CT600 figure for this year minus the accrued interest, rather than letting it roll forward again. So they will roll forward even a few quid.

[MrButton]

It should just sit on your account or they’ll send you a cheque.

I just received a cheque for £25 for interest accrued.

Therefore I think your accountant may be incorrect.

[PerfectStorm]

That's exactly what I asked my accountant - why doesn't it just roll forward... But no, less than a certain amount and it is written off / stolen.

However, this thread has finally pushed me into action to open an Aldermore account so that's a result.

Do it, shouldn't take you long to get an easy £50+ a month for stuff just sitting there

[rectifier]

I'd agree with this, probably just sat on your account and will be rolled forward to the next year if you have paid the full corporation tax payment as per your return.

That's exactly what I asked my accountant - why doesn't it just roll forward... But no, less than a certain amount and it is written off / stolen.

However, this thread has finally pushed me into action to open an Aldermore account so that's a result.

[Old Greg]

I'd agree with this, probably just sat on your account and will be rolled forward to the next year if you have paid the full corporation tax payment as per your return.

With interest.

[Michael at BI Accountancy]

No. Create an HMRC online account if you don't have one. You should see any interest there. When you submit your next CT return, the interest should be offset, so the amount owing will be less than shown on your CT600 for that year. Methinks your accountant is mistaken. I always pay close to the deadline, but the interest accrued is a few quid and it's always offset against the next return.

I'd agree with this, probably just sat on your account and will be rolled forward to the next year if you have paid the full corporation tax payment as per your return.

[jamesbrown]

Last year when I got my CT bill, my accountant put a note on the payment to the effect that if you paid the CT before the due date, HMRC will pay you interest of 0.5% until the due date.

Given that's a better rate than the standard CA interest rate I thought "why not".

This year when I got my CT bill I asked my accountant if the interest earned on last year's payment had been offset. The response was that the interest earned was too small for them to refund or offset, so they just pocketed it.

Trivial amount of money I know - gets my goat though.

Anyone else had this?

No. Create an HMRC online account if you don't have one. You should see any interest there. When you submit your next CT return, the interest should be offset, so the amount owing will be less than shown on your CT600 for that year. Methinks your accountant is mistaken. I always pay close to the deadline, but the interest accrued is a few quid and it's always offset against the next return.

[PerfectStorm]

Aldermore's easy access savings account pays double - 1%. So you may as well bank it, as well as the rest of your company's cash, in there until needed.

[rectifier]

How much was it? If it's that small is it really worth worrying about?

Anyone else thinking Richard Prior at this point?

Nope course it's not worth worrying about in terms of the value - HMRC just hack me off with this behaviour. You can be sure if I owed *them* interest, no matter how low the value, they'd be onto me.

They did it to me a couple of years ago with a paterntity leave credit which they refused to honour which was about 250 quid - ever since then I've been sensitive to it.

[northernladuk]

How much was it? If it's that small is it really worth worrying about?

Anyone else thinking Richard Prior at this point?