HMRC have issued a Revenue and Customs Brief setting out their position following the Court of Appeal judgment in Littlewoods Ltd & Ors v HM Revenue and Customs [2015] EWCA Civ 515. We reported on this judgment in our May newsletter.
HMRC seek to distinguish the facts and circumstances of the Littlewoods case from other High Court claims for compound interest on the basis that the Court of Appeal “maintained that statutory provisions will provide an adequate amount of interest in many cases, therefore it is not the case that compound interest will always be payable where there has been an overpayment of tax”. They remain of the view that there is no clear method for calculating the level of interest which provides adequate indemnity to claimants, which is the requirement of EU law.
HMRC have also confirmed that they are seeking leave to appeal to the Supreme Court and indicate that they will apply for any compound interest claims already lodged in the High Court or County Court to continue to be stayed and for any new claims to be stayed. Their position in relation to Tribunal appeals also remains unchanged.
HMRC suggest that they will reconsider their position in the event that permission to appeal to the Supreme Court is not granted.
This article appears in the JHA June 2015 Tax Newsletter, which also features:
