DMBM403030 - Interest: Interest on reallocations and repayments - by IT system: SAFE: Automatic calculation of repayment interest

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Where appropriate, SAFE will calculate RPI automatically on any reallocation between charges for the same customer. The RPI credit is shown separately on the charge record.

Where the overpaid tax or duty plus RPI credit can be applied fully to another outstanding charge on the same customer account the reallocation will be dealt with automatically. If the other outstanding charge is due within 30 days of the reallocation a reallocation letter will be issued to the customer. RPI will be calculated to the due date of the receiving charge. The customer has the opportunity to request repayment of the overpaid tax/duty up to the due date of the receiving charge (this follows guidance from HMRC Solicitors where it is considered reasonable business practice to retain a repayment where a further liability arises within 30 days providing the customer is informed and has the opportunity to claim repayment). If a customer claims repayment before the receiving charge is due the overpaid duty and RPI credit is transferred to Unallocated Payments and then to OAS. Any adjustment to the RPI credit due to the date of repayment will be calculated manually by the SAFE and Repayment team.

Where the overpaid tax/duty plus RPI credit can not be fully accommodated on other outstanding charges on the same customer account the overpaid amounts and RPI credits will be applied in the following order:

Payments of tax/duty utilising payments with the earliest EDP first and finally the RPI Credit. Any remaining overpaid tax/duty and RPI credits that cannot be allocated to other liability in SAFE will be posted to the Unallocated Payments suspense account. These payments can then be allocated to OAS for reallocation to another Head of Duty system or repaid.