Further rise in HMRC interest rates confirmed
Following the 13th consecutive increase in the Bank of England (BoE) base rate, HMRC’s interest rates on overpaid or underpaid tax will also increase. What are they and when will they take effect?
From 3 July 2023 the following rates will apply:
- Late corporation tax paid quarterly - 6%
- Interest on overpaid corporation tax - 4%
From 11 July, the rates for other taxes will apply:
- Late payment interest - 7.5%
- Interest on overpaid tax - 4%
In a press release HMRC states that the rate of late payment interest encourages prompt payment and ensures fairness for those who pay their tax on time, while the rate of repayment interest fairly compensates taxpayers for loss of use of their money when they overpay. Anyone struggling to pay a tax debt should contact HMRC to try and agree a payment plan. This won’t prevent interest being charged, but will protect against penalties if the agreed terms are adhered to.
Related Topics
-
How to apportion advisory mileage rates for EVs
In September, HMRC introduced a new two-tier advisory mileage rate for employees charging electric vehicles. The rate differs depending on whether the vehicle is charged at home or not. But what’s the correct approach if an employee does both?
-
Recovering salary overpayments due to payroll errors
Five employees at Glasgow City Council have together been ordered to pay back £40,000 in overpaid wages caused by a payroll error relating to the calculation of their contractual overtime. If you overpay wages to an existing employee due to a payroll error, can you recover them?
-
New tool to help determine whether activities are “qualifying”
HMRC has published a new online tool to help companies decide whether they are eligible to make a claim for research and development (R&D) relief. How does it work and is it worthwhile?
This website uses both its own and third-party cookies to analyze our services and navigation on our website in order to improve its contents (analytical purposes: measure visits and sources of web traffic). The legal basis is the consent of the user, except in the case of basic cookies, which are essential to navigate this website.