Finance Act 1994

Interest payable by the Commissioners

9 (1) Where, due to an error on the part of the Commissioners, a person has paid by way of duty an amount which was not due and which the Commissioners are in consequence liable to repay to him, they shall (subject to the following provisions of this paragraph and paragraph 10) pay interest to him on that amount at the specified rate for the applicable period (if and to the extent that they would not be liable to do so apart from this paragraph).

(2) For the purposes of this paragraph the applicable period is the period—

(a) beginning with the date on which the payment is received by the Commissioners, and

(b) ending with the date on which they authorise payment of the amount on which the interest is payable;

but in determining that period for those purposes there shall be left out of account any period referable to the raising and answering of any reasonable enquiry relating to any matter giving rise to, or otherwise connected with, the person’s entitlement to interest under this paragraph.

(3) In determining for the purposes of sub-paragraph (2) above whether any period is referable to the raising and answering of such an enquiry as is there mentioned, there shall be taken to be so referable any period which begins with the date on which the Commissioners first consider it necessary to make such an enquiry and ends with the date on which the Commissioners—

(a) satisfy themselves that they have received a complete answer to the enquiry, or

(b) determine not to make the enquiry or (if they have made it) not to pursue it further;

but excluding so much of that period as may be prescribed.

(4) For the purposes of sub-paragraph (3) above it is immaterial—

(a) whether any enquiry is in fact made, or

(b) whether any enquiry is or might have been made of the person referred to in sub-paragraph (1) above or of an authorised person or of some other person.

(5) The Commissioners shall only be liable to pay interest under this paragraph on a claim made in writing for that purpose.

(6) No claim shall be made under this paragraph after the expiry of six years from the date on which the claimant discovered the error or could with reasonable diligence have discovered it.

(7) Any reference in this paragraph to receiving a payment from the Commissioners includes a reference to the discharge, by way of set-off, of their liability to make it.

10 (1) Where a person (“the appellant”) who appeals to a tribunal under section 16 of this Act against an assessment of duty has paid, or given cash security for, the whole or any part of the duty, sub-paragraph (2) below shall apply if the tribunal find that the whole or any part of the amount paid or secured is not due.

(2) The Commissioners shall pay interest to the appellant, at such rate as the tribunal may determine, on—

(a) so much of the duty paid as is found not to be due or,

(b) so much of the cash security as relates to duty found not to be due,

for the period beginning with the payment of duty or, as the case may be, giving of the cash security and ending with its repayment.

(3) In this paragraph “cash security” means such adequate security as enables the Commissioners to place the amount in question on deposit.