Our tax preparation specialists explain what do to if you think your company has paid too much Corporation Tax

At DSR Tax Claims Ltd, we know that working out your company’s annual accounts can be hard work, and that’s before you have to deal with your Corporation Tax bill. That’s why our experts want to help make life as easy as possible for you by sharing our specialist knowledge with you. So, whether you are wanting more information about VAT or need to know about charitable tax relief, our handy guides are here to help. All our information is based on HMRC sources, so you can rest assured that these guides are filled with helpful and accurate information.

What if your organisation has paid too much Corporation Tax?

If you think that your company or organisation has paid too much Corporation Tax, HMRC will repay your overpayment. In certain circumstances, they may also pay interest at 0.5% on the overpayment.

How do you claim a Corporation Tax refund?

You can use your Company Tax Return to inform HMRC that you think you are due a Corporation Tax refund. You can also use this method to tell them how you would like to be repaid.

Your repayment methods are as follows:

  • You can have it repaid directly into your company’s bank account, or a different bank account if you  prefer – all you need to do is include the relevant bank account details in your tax return.
  • You can use it to offset against your next Corporation Tax bill (or any late filing penalty you might have).
  • You can use it to pay any other tax bill your company may have, so it can be offset against your PAYE or VAT bill if you prefer.

When do HMRC pay interest?

HMRC will pay interest at 0.5% if you have paid your tax bill early (HMRC call this ‘credit interest) or if you have paid more than your company owes in Corporation Tax (HMRC term this ‘repayment interest’).

You must include this interest in your company tax return because it does count as taxable income.

Early payments or ‘credit interest’

HMRC will usually calculate the interest they owe you from the date you pay your Corporation Tax to your actual payment deadline. The earliest date they will pay interest from is 6 months and 13 days after the start of your accounting period – if you pay any earlier than that, you won’t get credit interest for those days.

 If you pay more than you owe or ‘repayment interest’

HMRC usually pays interest from either when the tax was due, or from the date you paid your Corporation Tax bill (if you paid it after its due date).

What happens if you pay in instalments?

You will automatically be paid interest once HMRC know your final Corporation Tax bill for the accounting period, which is usually when you have filed your Company Tax Return. However, if you pay in quarterly instalments, HMRC will calculate your interest from the latest date of the following:

  • The date your payment balance goes above what you owe
  • The first instalment date.

How can DSR Tax Claims Ltd help?

We know that setting up a business can be hard work – there’s so much to think about and that’s before you start thinking about Corporation Tax and filing accounts. Our friendly team of tax specialists at DSR Tax Claims Ltd are on hand to help make life easier for you. We’re the experts at identifying your maximum allowable expenses so call us on 0330 122 9972 – we’re the tax experts you can trust.