HMRC Has Raised Late Tax Bill Interest Rates

As of the 5th July 2022, HMRC has raised interest rates on late tax bills by 0.25%, following an increase in the Bank of England base rate to 1.25% in June.

How much is the late payment interest rate now?

This increase brings the late payment interest rate to 3.75%, the highest rate since the height of the financial crisis in January 2009.

The corporation tax pay and file rate has also increased to 3.75%, up from 3.5%.

When is the late payment interest applicable?

Late payment interest is payable on late tax bills that cover income tax, National Insurance contributions, capital gains tax, stamp duty, stamp duty land tax and stamp duty reserve tax.

Interest on overpayments

Interest paid on overpaid quarterly instalment payments and on early payments of corporation tax not due by instalments rose to 2.25% as of the 27th June 2022, which is up from the previous 2%.