We have a UK resident client who did some work in Sweden. The Swedish tax office deducted 30% Swedish tax. We declared the income and paid the balance of 10% higher rate tax to HMRC. This went on for several years. In 22/23 the Swedish tax office said they shouldn't have been deducting tax from the outset, and paid it all back to the client. We wrote to HMRC, told them what had happened, and repaid all the DTR previously claimed. HMRC now want interest on it - which adds up to a fair sum. Has anybody come across this before, and are there any grounds for claiming that the credit is just an adjustment in 22/23 and should not be treated as adjustments to earlier years? Thanks!
12th Feb 2024
Refund of tax previously claimed as DTR
Can HMRC charge interest when double tax relief repaid by taxpayer