How do the section 80 unjust enrichment rules apply to overpayment claims under the special scheme?

The unjust enrichment provisions in section 80 of the VAT Act 1994 apply to overpayment claims under paragraph 31 of the special scheme. References to prescribed accounting periods are read as including tax periods, and references to crediting amounts include paying amounts, ensuring HMRC need not repay VAT where the cost was passed to customers.

What is the time limit for making a VAT overpayment claim under paragraph 32?

There is a strict four-year time limit. For actual overpayments to HMRC under paragraph 31(2) or related claims under paragraph 31(7)(b), the claim must be made within four years of the payment date. For credit claims under paragraph 31(3), the deadline is four years from the end of the quarter in which the assessment was issued.

How is the relevant date determined for the four-year deadline?

The relevant date depends on the claim type. For overstated VAT in a return, it is the end of the tax period in which the overstatement occurred. For an incorrect disclosure, it is the end of the tax period in which the disclosure was made. For a direct overpayment, it is the date of payment. For an incorrect assessment, it is the end of the quarter the assessment was issued.

What is an incorrect disclosure for the purposes of paragraph 32?

An incorrect disclosure occurs when a business tells HMRC or the relevant EU member state tax authorities that it failed to account for UK VAT in a particular tax period, but some or all of the disclosed amount was not actually due. The four-year claim deadline then runs from the period the disclosure was made, not the original period.

Value Added Tax Act 1994 section 80 / Schedule 9ZD paragraph 32

Overpayments: supplementary

Section 80 / Schedule 9ZD paragraph 32 sets out how the existing rules on overpaid or overstated VAT (in section 80) are adapted to apply to overpayment claims arising under the special scheme in paragraph 31, including unjust enrichment safeguards and strict time limits for making claims.

The unjust enrichment and recovery-by-assessment rules in section 80 apply to overpayment claims under paragraph 31, with references to prescribed accounting periods read as including tax periods and references to crediting amounts read as including paying amounts.
HMRC are not required to repay an overpaid amount if the claim is made more than four years after the relevant date; this applies to claims for repayment of overpaid VAT (paragraph 31(2)) and certain related claims (paragraph 31(7)(b)).
Similarly, HMRC are not required to credit an amount that was not due (paragraph 31(3) claims) if the claim is made more than four years after the relevant date.
The relevant date depends on the type of claim: it may be the end of the tax period in which VAT was overstated, the end of the tax period in which an incorrect disclosure was made, the date on which an overpayment was made, or the end of the quarter in which the relevant assessment was issued.

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