ENFORCEMENT – HMRC must repay overpaid tax with compound interest
Tax overpaid to HMRC must be repaid to the taxpayers with compound interest, the England and Wales High Court has ruled in the case of Littlewoods v HMRC. The decision means that HMRC must pay Littlewoods’ owners about GBP1.2 billion in interest, far more than if HMRC’s contention of simple interest had been upheld. The tax concerned was VAT, but Mr Justice Henderson’s logic applies equally to other taxes.
