On 8 December 2017, HMRC published Revenue & Customs Brief 5 (2017) in which it confirms its position following the Supreme Court’s judgment in Littlewoods Limited and Others v HMRC [2017] UKSC 70.

Following the Supreme Court’s decision that statutory interest in the case of refunds for overpaid VAT is all that is required, HMRC has confirmed that claims for compound interest will not be paid. HMRC has also confirmed that it will invite claimants to withdraw their claims and any related appeals to the First-tier Tribunal.

Taxpayers with compound interest claims relating to overpaid VAT should liaise with their professional advisors and, if appropriate, arrange for the timely withdrawal of their claims.

A copy of Business Brief 5 (2017) is available to view here.