Corporation Tax Act 2009 section 56

Exemption for interest on tax overpaid for accounting periods ending before 1 July 1999

Section 56 provides an exemption from corporation tax for interest received from HMRC on overpaid tax, where the relevant accounting period ended before 1 July 1999.

• When a company overpays corporation tax, HMRC may pay interest on the overpayment when refunding it.
• Such interest would normally be taxable as income for corporation tax purposes.
• This section exempts that interest from corporation tax where the accounting period to which the overpayment relates ended before 1 July 1999.
• No corporation tax liability arises on any interest paid by HMRC under these circumstances.