Late payment interest to be cut
A cut to the Bank of England base rate means there will be another reduction in HMRC's penalty interest rates. What are the new charges and when will they take effect?
Interest rates were cut from 4.25% to 4% on 6 August. HMRC penalty interest rates are set at the Bank of England base rate plus 4%, and as such a corresponding change to penalty interest will soon take effect.
From 18 August the interest rate on late corporation tax paid quarterly will be reduced from 6.75% to 6.5%. Whereas late payment interest on other taxes will go from 8.25% to 8% from 27 August.
The rate of repayment interest, which is a tax-free payment made on overpaid tax, will also be reduced from 3.25% to 3% from 27 August.
Related Topics
-
Government rushes through NI cap on pension salary sacrifice
The government has already drafted legislation to impose a £2,000 limit on NI exempt pension contributions under salary sacrifice arrangements. What else do we know?
-
Sneaky change is a blow for side hustles
With most of the media focused on the headline-grabbing announcements from the Budget, a read of the published small print reveals another change coming in 2029. It’s bad news if you are an employee with a side hustle, but what’s going on?
-
Dodging the 2027 IHT and pension changes
In a little over a year the inheritance tax (IHT) exemption for unused pension savings comes to an end. If you’re married or in a civil partnership, one simple step might save your estate thousands in IHT. What is it?