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
-
Selling spare items to your company
You’re short of cash but if you use the traditional methods to take more money out of your company you’ll pay higher rate taxes. Is there another way to extract profits without paying income tax or NI?
-
No such thing as a (tax) free lunch?
You run a small consultancy company and treat your staff to lunch in the office once a week. Your bookkeeper says it’s a taxable benefit in kind because staff lunches are only exempt if they are provided in a workplace canteen. Is this correct?
-
Judge criticises use of fabricated AI-generated cases in HMRC appeal
A tax tribunal judge has criticised the use of apparently fabricated case references generated by artificial intelligence in an appeal against HMRC. The incident highlights growing concerns over the use of AI tools in legal and tax proceedings. What happened?