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COVID-19: Quarterly instalment payment regime for companies

19th March 2020

COVID-19: Quarterly instalment payment regime for companies

As a result of the financial downturn caused by the COVID-19 pandemic it is possible that your company may now be in an overpayment position with respects to its obligations under the corporation tax quarterly instalment payments (QIPs) regime.

If following a review of your latest financial and cash flow forecasts you believe that your forecast corporation tax liability is going to be less than you previously expected, it should be noted that it is possible to request from HMRC a repayment of any overpaid corporation tax instalments.

For example, if your latest forecasts now predict a revised annual corporation tax liability of £200,000 (two payments on account of £100,000 each) but you had previously forecasted an annual corporation tax liability of £300,000 and in accordance with this had made two quarterly payments to date of £150,000 in total. You can request a repayment of £50,000 now. 

There is no requirement for the company’s corporation tax return to be submitted to HMRC. A request made via a claim/notice sent to an officer of HMRC is sufficient and it must state both:

  • The amount which the company considers to be repaid
  • The grounds for believing that, by reason of a change in circumstance of the company since the QIPs payments were made that:
    • The amount of the total liability for the period is likely to be less than previously calculated
    • The aggregate amount paid on account which exceeds the revised aggregate amount which would have been treated as becoming due and have been payable to date having regards to the revised calculation of the total liability.

If you have any queries or require any assistance with this, please do not hesitate to contact your usual haymacintyre contact or email