COM50080 - Claims/reliefs: loss and non-trading deficits carry-back: changing the EDP
The COTAX calculated effective date of payment (EDP) of a loss or non-trading deficit carry-back posting produces the wrong result for interest purposes when:
- a carry-back has already caused a repayment or reallocation for the Accounting Period (AP)
- there has already been a repayment or reallocation for the AP as a result of a carry-back and you amend the amount of the carry-back
- the carry-back results in the displacement of another relief or set-off that you would have allowed if the company had not made the carry-back claim
- a loss carry-back reduces the rate of liability from the full CT rate to the Small Profits Rate (SPR)
- 迟丑别谤别听is a loss carry-back and the caseworker has overwritten the computer calculated Marginal Relief (MR) figure
- in the case of a loss carry-back, tax is chargeable other than at the SPR that are below Lower Relevant Maximum Amount (LRMA) (for example a close investment holding company)
- there is聽more than one loss carried back and you need to alter the order in which the computer processes trading losses
You must recognise such cases and intervene by correcting the EDP where that is possible or request that the聽HMRC Payments Operations team聽 calculate the interest manually where it is not possible. See COM50090 for more information.
Correcting the effective date of payment (EDP)
When you make or amend an assessment using function RAMA (Record/Amend Assessment), you can over-ride the COTAX calculated EDP and enter a non-standard EDP where appropriate.
You can only correct the interest position by correcting the EDP when giving effect to a carry-back that only displaces some other relief or set-off, and so does not itself satisfy any outstanding liability to CT. COM50085聽Example 1 illustrates such a case.
It is not possible to correct the interest position by amending the EDP if you cannot give the carry-back posting a single correct EDP. COM50085聽Example 2 illustrates such a case.
When it is not possible to correct the EDP, you must intervene by setting the clerical interest indicator (CII),聽see COM95015 if it is not set already.
When you have amended the assessment following the setting of CII, you have to make any repayment using function DIRR (Direct Repayment). In these cases, you also need to send an eForm to GBP Payments Operations to advise them of the interest consequence of the carry-back; for further details, see COM129000.
See: