VDIM6010 | Interest adjustments: Functions of Form VAT663

This guidance deals with interest matters in respect of prescribed accounting periods starting on or before 31 December 2022. Interest matters with effect from 01 January 2023 are dealt with under Finance Act 2009.

Please see Compliance Handbook page CH140000 onwards to find the new interest rules guidance.

Form VAT663 has two main functions:

• To adjust the amount of Interest Bearing Tax (IBT), that is the amount of tax that interest is charged on. The IBT can be reduced or increased and this will have a direct impact on the amount of interest that will be charged or reduced. It is possible for the IBT to be increased or decreased between two given dates or left open ended, and

• To input a direct adjustment to the amount of interest that will be charged or reduced.