HMRC interest rate rises
From 13th April 2023, the interest rate HMRC will charge on late payments will increase to 6.75%.
The repayment interest rate will also rise, to 3.25% from 13th April 2023.
These HMRC interest rate increases are as a result of the recent increase in the Bank of England base rate to 4.25% on 23rd March 2023. The late payment interest rate will be at the highest level since the financial crisis of November 2008.
Late payment interest is payable on late payment of Income Tax, National Insurance, Capital Gains Tax, Stamp Duty and Stamp Duty Reserve tax.
Corporation tax self assessment interest rates relating to interest charged on underpaid quarterly instalment payments rises to 5.25% from 5% on the 3rd April.
The interest paid on overpaid quarterly instalment payments and on early payments of corporation tax not due by instalments rises to 4% from 3.75% on the 3rd April.
You can see more details on this related gov.uk page.
What if I can’t pay my tax?
If you’re unable to make payment of any tax amount that may be due to HMRC, we would strongly advise facing the issue head on, rather than avoiding it.
HMRC are far more receptive to suggestions and proposals around late payments if you take this stance, and if you contact them before the due date arrives.
There are full details on the ‘Dealing with HMRC – If you cannot pay your tax bill on time’ pages of the gov.uk website, where you can find details to apply online for a payment plan, or contact details to speak to the HMRC Payment Support Service if you can’t set one up online.
Anyone can use the HMRC Payment Support Service, not just businesses. Their contact details are as follows:
Telephone Number: 0300 200 3835
Opening Times: Monday to Friday 8am – 6pm.
Closed weekends and Bank Holidays.
As always, if you have any questions about HMRC Interest rate changes, or are worried about your tax position, please get in touch.
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