Companies that have to estimate their tax and pay it upfront throughout the year could be substantially out of pocket following Revenue & Customs' announcement that it will pay zero percent interest on money it owes taxpayers. The Revenue is to start paying zero interest on overpaid income tax, capital gains tax, VAT and stamp duty land tax. It will also only pay zero interest on money that it owes to a large range of corporates it is in dispute with. Rupert Shiers, partner of lawyers McGrigors' tax disputes and investigations team, said: 'There are a large number of multi-million pound claims against HMRC for overpaid tax which have yet to be settled. HMRC seems to suggest that it will be seeking to reduce interest that it will owe on those funds to zero percent.' He added that the announcement will cost companies that have to estimate their tax and pay it upfront throughout the year to the Revenue a lot of money. 'These companies frequently find they have overpaid HMRC and the interest payments are important to them.' But unsurprisingly, taxpayers who owe HMRC money will not be able to take advantage of the zero percent offer, said Shiers. European law states that HMRC has to pay a commercial rate of interest on tax that it has overcharged. In the light of this, Shiers said: 'You have to question whether zero percent is really commercially competitive. Add in the impact of inflation and this does begin to look unfair.'