Corporation Tax Refund

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It has come to light that due to a system error, one of my limited company clients has had corporation tax submissions made with overstated profits and has significantly overpaid tax. Companies house have accepted the restated accounts, but HMRC are not accepting my multiple refund requests. The latest reason I received was that more than 4 years have passed since the CT overpayment.
 

Whilst irrelevant to my question, this is a problem my practice has inherited and I would just appreciate any advice or tips anyone who may have experience with a similar problem could offer? Is there a way around the 4 year deadline or am I wasting time?

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By Paul Crowley
20th Jun 2024 00:00

I could not possibly advise that you should have just made appropriate amendments in the current accounts.
I think you are probably wasting your time for items that long ago.
If it was in date then I really would just look to fix it this year.
HMRC would just have had the money a bit earlier than they should.

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Replying to Paul Crowley:
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By FactChecker
20th Jun 2024 01:19

Pragmatism in action, but methinks a little too late if OP has already sent "multiple refund requests" to HMRC.

OP: How much is the "significantly overpaid tax" and spanning how many years?
And what kind of "system error"?

With the advantage of hindsight, I might not have rushed to restate the accounts at CH before finding out what can be achieved with HMRC; but you'll be searching for odd circumstances to have any chance, so probably now need to sub-contract the problem.

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Replying to FactChecker:
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By Paul Crowley
20th Jun 2024 01:41

Agree on the companies house thing. I would not have bothered at all with any amended accounts to companies house.
But sympathy with OP as I have had similar issues when I took over the firm. I found quite a few outrageous errors on the clients that former partners had dealt with. I needed to take the hit for their eff ups. One example was failing to claim personal allowances on expats with UK rent.

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Replying to Paul Crowley:
DougScott
By Dougscott
20th Jun 2024 10:38

Qualified accountants not claiming PA on ex-Pat rent??? Surely not.

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Replying to Dougscott:
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By Paul Crowley
20th Jun 2024 12:21

DIYers also tend to miss it as well.

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By TURNER89
20th Jun 2024 12:14

Thanks for your support, it’s such a frustrating situation. The overpayment is in the region of £50k and the multiple requests has been backwards and forwards correspondence after the initial rejection of the refund request.

The situation arose due to a system transfer and duplication of invoices, compounded by a virus that wiped out excel spreadsheets used to track sales. The problem spanned 2 years, and annoyingly the refund request was submitted about 6 months after the deadline for the second year.

I was hesitant to amend current accounts as the values involved would create an uncharacteristic loss and I didn’t want to trigger HMRC investigating anything but admittedly my approach may be different if I were ever to find myself in a similar situation again.

Was hoping someone may have had experience and could suggest an avenue I may not have explored, unfortunately the deadlines are textbook for CTA but not the exceptions!

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Replying to TURNER89:
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By kim.shaw-and-co.com
20th Jun 2024 23:05

TURNER89 wrote:

Thanks for your support, it’s such a frustrating situation. The overpayment is in the region of £50k and the multiple requests has been backwards and forwards correspondence after the initial rejection of the refund request.

The situation arose due to a system transfer and duplication of invoices, compounded by a virus that wiped out excel spreadsheets used to track sales. The problem spanned 2 years, and annoyingly the refund request was submitted about 6 months after the deadline for the second year.

I was hesitant to amend current accounts as the values involved would create an uncharacteristic loss and I didn’t want to trigger HMRC investigating anything but admittedly my approach may be different if I were ever to find myself in a similar situation again.

Was hoping someone may have had experience and could suggest an avenue I may not have explored, unfortunately the deadlines are textbook for CTA but not the exceptions!

Out of curiosity, may I ask why you filed amended accounts for all relevant years at Companies House instead of dealing with it by way of a Prior Year Adjustment in the next set of accounts to be prepared ?

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