Certificate of Tax Deposit: Claiming Your Refund After Scheme Closure

If you still hold a Certificate of Tax Deposit, you can no longer use it to pay a tax bill. The HMRC scheme closed to new purchases on 23 November 2017 and stopped accepting existing certificates as tax payments on 23 November 2023. Your only remaining option is to claim the balance back as a cash refund, and you should do that as soon as possible: HMRC is working through unclaimed certificates, and balances it cannot return will be treated as forfeited.¹

How to Claim Your Refund

Send a written request to the CTD Team together with the physical certificate. The letter needs to say you want the deposit returned as a cash refund, and it must include your bank account name, account number, sort code, and the name of your bank or building society so HMRC can pay you electronically.¹

Include the details HMRC needs to match the certificate to your record: the certificate number, the deposit date and amount, and either your Unique Taxpayer Reference (a ten-digit number) or your National Insurance number.

The address is:

CTD Team
Floor 6
1 Atlantic Square
21 York Street
Glasgow G2 8JQ
United Kingdom²

HMRC wants the original document, not a photocopy. If you have lost the certificate, you will need to provide a formal indemnity statement protecting the government against any later claim on the same funds.

What Happens If You Do Nothing

Since 23 November 2023, HMRC has been trying to repay the balances of certificates that were never used. Where it cannot reach the current holder after what it considers reasonable effort, the balance will be treated as forfeited.¹

There is no published statutory deadline. The guidance does not set a fixed period after which forfeiture becomes automatic, so how long you have depends on whether HMRC can reach you. If your address, phone number, or bank details have changed since you bought the certificate, contact the CTD Team at the Glasgow address now. The longer the trail is cold, the greater the risk that your balance is classified as unreachable.

If you disagree with the amount HMRC eventually credits, or with how it has handled your certificate, that goes through the standard route for disputing a tax decision. You normally have 30 days from the date of the decision letter to appeal or request a review.³

What the Scheme Was

A Certificate of Tax Deposit was a financial instrument issued by HM Revenue and Customs. It let individuals and businesses hand money to HMRC in advance, earning interest until the holder chose to apply the deposit against a future tax liability. Taxpayers used it to set aside cash during profitable periods so they could cover large bills later without a last-minute scramble, and it was particularly useful during disputed assessments because depositing funds early stopped late-payment interest from running on the contested amount.

HM Treasury announced the closure on 22 November 2017, and no new deposits or top-ups have been accepted since the following day. Existing holders were given six years to use their balances against Income Tax under Self Assessment, standard Capital Gains Tax (not the ATED-related version), Inheritance Tax, Petroleum Revenue Tax, or, in the case of Series 6 certificates purchased in 1993 or earlier, Corporation Tax. Series 7 certificates, the most recently issued, could never be applied to Corporation Tax at all.⁴ That six-year window has now closed, which is why refund is the only route left.

Interest on Your Refund

Certificates paid two different rates depending on how the money ended up being used. Deposits applied to the holder’s own tax bill earned the higher “tax rate.” Deposits withdrawn as cash, or used to pay someone else’s tax, earned the lower “cash rate.”¹ A refund is a cash withdrawal, so the cash rate applies to your balance.

Under the Series 7 rates in force from 6 March 2009, deposits under £100,000 earned no interest at all, and deposits above £100,000 held for less than a month also earned nothing. Only deposits above £100,000 held for more than a month earned interest, at 0.75% at the tax rate and 0.25% at the cash rate.¹ For most personal holders, then, the refund will be close to the original deposit.

If You Are a US Taxpayer

The Certificate of Tax Deposit was an HMRC scheme and applied only to UK taxes. The rough US equivalent, still available, is a deposit under Internal Revenue Code Section 6603, which lets a taxpayer pay money to the IRS to suspend the running of interest on a potential underpayment while a dispute is resolved.⁵ The remittance has to be accompanied by a written statement identifying it as a Section 6603 deposit and specifying the type of tax, the tax year, the amount, and the basis for the disputable tax; without that designation, the IRS will treat the money as an ordinary payment.⁶ This is a separate regime from the closed UK scheme and has no bearing on any outstanding UK certificate you hold.

1
HM Revenue & Customs. Certificate of Tax Deposit Scheme
2
GOV.UK. Certificate of Tax Deposit Scheme Enquiries
3
GOV.UK. Disagree With a Tax Decision or Penalty
4
HM Revenue & Customs. Certificate of Tax Deposit Scheme – Section: Closure of the Certificate of Tax Deposit Scheme
5
Office of the Law Revision Counsel. 26 US Code 6603 – Deposits Made to Suspend Running of Interest on Potential Underpayments, Etc.
6
Internal Revenue Service. Deposits Made to Suspend the Running of Interest on Potential Underpayments