checking HMRC interest calculations

checking HMRC interest calculations

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We have won a substantial income tax repayment covering a number of years for our client and we were sent by HMRC  3 pages of calculations showing tax due/ repaid, interest repaid and charged. We no not understand the logic behind the calculations , such as why part of earlier payments of tax have been repaid whilst later payments of tax have been used against tax due for earlier years. Has anyone a simple!!! tax interest paid/received calculator we could use to check the figs? When we asked HMRC it was too difficult for them, they just rely on their computer they said.

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By tebthereb
20th Feb 2014 22:02

Too difficult for a rep on the phone?

Is this what HMRC said on the phone? It sounds like something a rep would say on the phone rather than a qualified HMRC employee.

Appeal in writing if you suspect payments allocated incorrectly and that interest is too low.

I don't know any software but I would have thought a fairly simple formula on Excel would give a sensible outcome if you know the dates of liabilities and payments.

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By ACDWebb
20th Feb 2014 22:42

Are you looking at

simple calculations or optimising allocation of payments as well?

The latter should be allocated by when the tax was paid over and what liabilities were outstanding at the time, so for example say you had reduced payments on account from £6k to £5k each instalment and paid the reduced amounts, but the actual liability was £11k so that the PoA became £5.5k and the balance of £1k was paid on 30/11 you will find that the allocation is

Due / paidDuePaidInterest onfromPOA1 31/15500500050031/1 to 30/11POA2 31/75500500050031/7 to 30/1130/11 1000  

and not

Due / paidDuePaidInterest onfromPOA1 31/155005000  31/7 50050031/1 to 31/7POA2 31/755004500  30/11 1000100031/7 to 30/11

I had an Excel addin that did the simple calcs a while back but it probably needs major updating now so I wouldn't really want to offer it up

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