HMRC Late Payment & Repayment interest rises

HMRC interest rates are set in legislation and are linked to the Bank of England base rate. There are 2 rates:

• late payment interest, set at base rate plus 2.5%

• repayment interest, set at base rate minus 1%, with a lower limit of 0.5% (known as the ‘minimum floor’)

As a result of the latest base rate rise, HMRC interest rates for late payments and repayments will increase.

From 22nd August 2023 HMRC will charge 7.75% interest on late payments and 4.25% on repayments.

Find out more: https://www.gov.uk/government/publications/rates-and-allowances-hmrc-interest-rates-for-late-and-early-payments/rates-and-allowances-hmrc-interest-rates

Source: GOV.UK