Income Tax Act 2007 section 257GD

Date from which interest is chargeable

Section 257GD determines when interest begins to accrue on tax that becomes due following the withdrawal or reduction of SEIS income tax relief.

• When SEIS relief is withdrawn or reduced under certain specified provisions, any resulting tax liability carries interest from a modified start date.
• The interest start date is set at 31 January following the tax year in which the assessment to withdraw or reduce relief is made, rather than the normal due date for the original tax year.
• The specified provisions cover breaches of investor requirements (such as holding a substantial interest or having linked loans), failures to meet issuing company requirements, and various events triggering withdrawal (such as disposal of shares, put options, receipt of value, or acquisition of trade assets or share capital).
• This modified interest date means the investor is not penalised with interest running from the original filing date, recognising that the circumstances triggering the withdrawal may have arisen after the relief was initially and properly claimed.