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’)The late payment interest rate encourages prompt payment. It ensures fairness for those who pay their tax on time.The repayment interest rate compensates taxpayers fairly, when they overpay or pay early, for loss of use of their money.
Source: gov.uk
Latest Posts in "United Kingdom"
- UK Supreme Court Rules Input VAT on Share Sale Professional Fees Irrecoverable for Holding Companies
- Isle of Man to Raise Plastic Packaging Tax Rate from April 2026
- Supreme Court Upholds VAT Restrictions on Share Sale Costs in Hotel La Tour Case
- UK VAT Gap Rises to £11.9bn in 2024/25, Up from £8.9bn Last Year
- Change in the VAT treatment of supplies of locum medical practitioners
