Late payment interest rises again
A further increase in the Bank of England’s base rate means that HMRC’s late payment interest rates will rise again next week. What will the new rates be?
On 2 February, the Bank of England announced that it would increase the base rate of interest by 0.5%, to 4%. This is the tenth successive increase since December 2021. As HMRC’s late payment and repayment interest rates are linked to the base rate, they are also set to increase. From 13 February 2023 the following rates will apply:
- Late corporation tax paid quarterly - 5%
- Interest on overpaid corporation tax - 3.75%
From 21 February, the rates for other taxes will apply:
- Late payment interest - 6.5%
- Interest on overpaid tax - 3%
If your tax payment is outstanding, make the payment as soon as possible to avoid higher interest charges. Note that these will apply even if you agreed a time to pay arrangement with HMRC, so it's still more efficient for you to pay as much as you can sooner.
Related Topics
-
Tribunal rejects reliance on adviser as reasonable excuse
A recent First-tier Tribunal decision has confirmed that relying on an accountant does not automatically amount to a reasonable excuse for missing a self-assessment deadline. The case highlights the limits of delegating tax responsibilities. What does this mean in practice?
-
HMRC issues new wave of offshore “nudge” letters
HMRC has issued a further round of “nudge” letters targeting individuals it believes may have undeclared offshore income or gains. The letters form part of HMRC’s ongoing use of data from international information exchange agreements. What should you do if you receive one?
-
Payroll changes for 2026/27
As the end of 2025/26 draws closer, HMRC has published a raft of updates and reminders for employers. Which changes do you need to be aware of that might impact your payroll in 2026/27?