Statutory interest and repayment of overpaid excise duty

Foreword

Further help and advice

If you need general advice or more copies of Customs and Excise notices, please ring the Helpline on 0845 010 9000. You can call between 8.00 am and 8.00 pm, Monday to Friday.

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All calls are charged at the local rate within the UK. Charges may differ for mobile phones.

1. Introduction

1.1 What is this notice about?

This notice explains:

• how to claim a repayment if you have overpaid excise duty;
• when we will pay statutory interest automatically, because we have unduly delayed a repayment of excise duty to you;
• how to claim statutory interest when you have overpaid excise duty as a result of our error;
• when we will pay statutory interest following a tribunal decision; and
• your rights of review and appeal if we refuse your claim for repayment of overpaid excise duty, or against non payment of statutory interest.

This notice does not explain how to obtain a refund of excise duty when there is already a method in place for doing this (e.g. alcoholic ingredients relief, warehouse warrants, rejected imports).

You will find further information on how to obtain a refund of excise duty in the public notice for the specific excise regime.

This notice and others mentioned are available both on paper and on our Internet site at www.hmce.gov.uk.

The principles set out in this notice also apply to Air Passenger Duty.

1.2 Law

This notice does not have force of law but it explains how we interpret the relevant parts of:

• Finance Act 2001 Schedule 3;
• Finance Act 1994 Sections 14-16 and Schedule 5; and
• Customs and Excise Management Act 1979 (CEMA) Section 137A.

2. Overpaid excise duty

2.1 When can I reclaim excise duty I have overpaid to you?

If you have paid an amount of duty to us, which was not due, we will repay that amount to you providing you:

• make a satisfactory claim for the repayment (see paragraph 5.2);
• make that claim within three years from the date the duty was overpaid; and
• will not be unjustly enriched if we repay you.

2.2 Can I reclaim excise duty I have overpaid to a supplier?

Yes. If, because of our error, you have paid duty on goods from your supplier when duty wasn’t due, we will repay that duty if it relates to:

• spirits used for medical or scientific purposes;
• spirits used in art or manufacture;
• spirits contained in imported goods not for human consumption;
• oil delivered for home use for certain industrial purposes;
• light oil for use as furnace fuel; or
• heavy oil used for a permitted purpose.

But you will only be entitled to a repayment if:

• you have previously requested authorisation or approval to receive excise goods that are relieved of duty; and
• we have wrongly refused to give authorisation or approval; and
• as a result, you have been forced to pay duty on goods, when no duty was due.

2.3 What if my circumstances differ from those covered in 2.1 and 2.2?

This notice and the notices for individual excise regimes set out the most common situations leading to an entitlement to repayment of excise duty.

If they do not cover your particular circumstances, and you feel that you still have an entitlement to repayment, you should contact the Helpline.

3. Entitlement to statutory interest

3.1 When will I be entitled to statutory interest?

Statutory interest is a form of compensation we pay when:

• we have unduly delayed a duty repayment claim (see section 4 of this notice);
• you have overpaid duty as a result of our error (see paragraphs 2.1, 2.2 and section 5 of this notice); and
• you have paid, or given cash security for, an excise assessment which a VAT and Duties Tribunal has ruled was not due (see section 6 of this notice).

3.2 What is the rate of interest and how do you calculate it?

We will calculate interest using the rate applied to VAT and other indirect taxes. You can find further information about these rates from our website or by telephoning 01702 366063.

4. Statutory interest for undue delay

4.1 When may I qualify for statutory interest for undue delay?

You will qualify for statutory interest if we take longer than 30 calendar days to authorise a claim for repayment, or drawback of excise duty.

When we calculate the time taken to authorise the claim, the law allows us to deduct the time taken to:

• make reasonable enquiries to make sure the claim is legitimate and accurate; and
• correct errors or omissions on the claim.

You will qualify for statutory interest if, after we have made allowable deductions there are still more than 30 calendar days between the date of receipt of your claim and the date we authorise repayment or drawback.

4.2 How will you pay statutory interest for undue delay?

We will pay statutory interest automatically at the same time as we pay your claim for repayment or drawback.

4.3 What if I disagree with the amount of statutory interest paid for undue delay?

You should take action in accordance with section 7 of this notice.

4.4 What if I think I should have received statutory interest for undue delay?

As explained in paragraph 4.2 statutory interest should be paid automatically if applicable.

However, if you think there has been undue delay in paying your claim but you have not received statutory interest, you should write to your local Business Advice Centre. You should explain why you feel you are entitled to statutory interest. We will examine all the circumstances relating to the payment of your claim, including the deduction of any reasonable enquiry time, and will either:

• pay statutory interest if appropriate; or
• write to you and explain why statutory interest has not been paid.

If you are not satisfied with our decision, you may take action in accordance with section 7 of this notice.

5. Statutory Interest for an official error

5.1 When may I qualify for statutory interest for an official error?

We will pay statutory interest where, because of our error you:

• have overpaid excise duty directly to us; or
• ·have been forced to pay duty on goods, when duty wasn’t due, in the circumstances described in paragraph 2.2; or
• did not make a claim for repayment or drawback of excise duty to which you were entitled; or
• have been refused a claim for repayment and it is later found that our decision was wrong;

and we subsequently authorise repayment of that duty.

5.2 How do I apply for repayment of duty and statutory interest for official error?

You can make a combined claim for both repayment of overpaid excise duty and statutory interest.

There is no specific form to make your claim on, but you must make it in writing and include the:

• amount of the repayment claim;
• method used to calculate the claim;
• reason(s) why you think we have made an error; and
• details of any documents you have to support your claim (we may ask to see these later).

We will not pay a claim for excise duty you have overpaid to us if that would result in you being unjustly enriched.

5.3 Time limits

You cannot claim interest if more than three years have elapsed since we authorised your claim for repayment of duty.

6. Statutory Interest following a Tribunal Decision

6.1 When may I qualify for statutory interest following a tribunal decision?

We will pay statutory interest if you have paid, or given cash security for, an excise assessment and the VAT and Duties Tribunal find that all or part of the amount paid or secured is not due.

7. Appeals

7.1 What if I disagree with your decision?

If you do not agree with our decision:

• not to repay overpaid excise duty to you; or
• to refuse or only partly allow interest;

you can ask us to formally review your case.

Your request for review must be in writing and should set out the reasons why you do not agree with our decision.

You should send your request for review to your local reviewing officer within 45 days of the day you received written notification of our decision.

7.2 What if I am still not satisfied?

If you are not satisfied with the outcome of our review or we do not respond within 45 days from the date you requested the review, you can appeal to an independent VAT and Duties Tribunal.

You will find further information on the review and appeals procedures in Notice 990 Excise and Customs Appeals.

Do you have any comments?

We would be pleased to receive any comments or suggestions you may have about this notice. Please write to:

HM Revenue & Customs
Penalties and Debt Management Team
4th Floor NE
Queens Dock
Liverpool L74 4AA

If you have a complaint or suggestion

If you have a complaint about our service, or a suggestion on how we can improve it, you should contact your local office or the port or airport. You will find the phone number under 'HM Revenue & Customs - complaints and suggestions' in your local phone book. Ask for a copy of our code of practice on complaints (Notice 1000). You will find further information on our website at http://www.hmce.gov.uk. If we cannot settle your complaint to your satisfaction, you can then ask the Adjudicator to look into it.

The Adjudicator, whose services are free, is an impartial referee whose recommendations are independent.

The address is:

The Adjudicator's Office
8th Floor
Euston Tower
286 Euston Rd
London
NW1 3US

Phone: (020) 7930 2292
Fax: (020) 7930 2298
E-mail: adjudicators@gtnet.gov.uk
Internet: http://www.adjudicatorsoffice.gov.uk/

Update 1 issued November 2004

This update is to inform you of a change of address on the inside back cover of this Notice.

Inside back cover

Do you have any comments?

Delete address

HM Customs and Excise
Penalties and Debt Management Team
4th Floor NE
Queens Dock
Liverpool
L74 4AA

Insert new address

HM Revenue & Customs
Central Policy
Tax Administration Advice
8th Floor Imperial Court
2/24 Exchange Street East
Liverpool
L2 3PQ

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