To use easy numbers, director had an over drawn directors loan account at 31 March 2018 of £100k
The director died 8 months after the year end and his assets were frozen. Consequently the estate was unable to repay the loan balance within 9 months of the year end.
A s455 liability became payable (and was paid by the company).
The estate then repaid the loan balance in April 2019.
HMRC have stated that the earliest the s455 will be repaid is January 2021 (ie. 9 months after the accounting period in which the loan was repaid).
This does fit with the legislation, but will be nearly 21 months after the company has received repayment of the loan. I’m loath to propose shortening the year to artifically bring forward the repayment date. Has anyone had any discretion on this point from HMRC to enable the s455 to be credited against corporation tax sooner, or actually get a refund?
It seems that HMRC will not pay any interest on this amount and should the company have cashflow issues, it feels bizarre that they can't chase a debtor for the cash.