Late payment interest rates changed again
Late payment interest rates on underpaid taxes will soon decrease again due to the recent reduction in the Bank of England’s base rate. What are the new charges?
On 6 February 2025 an announcement confirmed a reduction in the Bank of England base rate to 4.5% from 4.75%. As HMRC’s late payment and repayment interest rates are linked to the base rate, they will also come down.
From 17 February 2025 the following rates will apply:
- Late corporation tax paid quarterly – 5.5%
- Interest on overpaid corporation tax – 4.25%
From 25 February 2025, the rates for other taxes will be:
- Late payment interest – 7%
- Interest on overpaid tax – 3.5%
Penalty interest can be avoided by paying your tax bill on time. You can use HMRC's calculator to calculate the late payment interest and any penalties due for previous tax years.
Related Topics
-
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?
-
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?
This website uses both its own and third-party cookies to analyze our services and navigation on our website in order to improve its contents (analytical purposes: measure visits and sources of web traffic). The legal basis is the consent of the user, except in the case of basic cookies, which are essential to navigate this website.