The Bank of England’s decision to reduce the base rate to 5% means that HM Revenue & Customs (HMRC) will also reduce their interest rates.
The interest rates charged by HM Revenue and Customs on late tax payments, as well as the rates they pay on repayments are linked to the Bank of England’s base rate. Late payment interest is charged at base rate plus 2.5%. Repayment interest is paid at base rate minus 1%, subject to a minimum of 0.5%.
The reduced rates will apply from:
- 12 August 2024 for quarterly instalment payments; and
- 20 August 2024 for non-quarterly instalments payments.
For more info see: https://www.gov.uk/government/news/hmrc-late-payment-interest-rates-to-be-revised-after-bank-of-england-cuts-base-rate