As the Bank Of England increased interest rates again in March, HMRC has followed suit and also increased it's interest rates on late payment bills to 6.75% effective from 13 April. This is the highest level since January 2008
The late payment and repayment interest rates follow the rise in the Bank of England base rate to 4.25% on 23 March and are applied to the main taxes and duties that HMRC currently charges and pays interest. The rates will rise to:
late payment interest rate — 6.75% from 13 April 2023
repayment interest rate — 3.25% from 13 April 2023
This is the highest rate since the start of the financial crisis in November 2008.
Late payment interest is payable on late tax bills covering income tax, National Insurance contributions, capital gain tax, stamp duty land tax, stamp duty and stamp duty reserve tax. The corporation tax pay and file rate also increases to 6.75%.
Repayment interest will also be increased from the current 3% rate to 3.25%.