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
-
Corporation tax return filing deadline
-
Don’t overlook the partial exemption annual adjustment
As VAT year ends approach for many businesses, HMRC’s guidance highlights the need to carry out the partial exemption annual adjustment. This is often overlooked but can have a direct impact on recoverable VAT. What do you need to check?
-
Could HMRC recategorise your subcontractors?
You use subcontractors for all your building projects and almost always the same individuals. You’ve heard that this could increase the risk of HMRC recategorising them as employees. What steps can you take to counter this?