HMRC cuts late and repayment interest rates
HMRC will reduce late payment and repayment interest rates from 25 February following the cut in the base rate.
The Bank of England cut the base rate to 4.5% on 6 February, triggering a 0.25% cut in HMRC interest rates which are pegged to the base rate.
From 25 February, the late payment interest rate will be cut to 7.0% from 7.25%.
The repayment interest rate will be cut to 3.5% from 3.75% from 25 February.
HMRC late payment interest is set at base rate plus 2.5%. Repayment interest is set at base rate minus 1%, with a lower limit – or ‘minimum floor’ – of 0.5%.
Corporation tax self assessment interest rates relating to interest charged on underpaid quarterly instalment payments dropped to 5.5% from 5.75% from 17 February, a week earlier than the main late payment rate change.
Internet link: GOV.UK
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