Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Interest rates streamlined

31 July 2009
Categories: News , Admin , Business , Capital Gains , Companies , Income Tax
A new minimum interest rate on tax repayments of 0.5% is to be introduced

A new minimum interest rate on tax repayments of 0.5% is to be introduced by HMRC. This means that in future interest will still be payable even when the Bank of England base rate falls below 1.5%.

The Government will also be introducing changes to the current interest rates regime which will deliver greater transparency and certainty in the way that rates are set and applied. This will pave the way for the implementation of full interest harmonisation which was legislated for in this year’s Finance Bill.

HMRC will recalculate its rates after the September monetary policy meeting using the new formulae provided in the regulations. Harmonisation will result in a change to some of HMRC’s interest rates even if there is no change in the base rate announced by the MPC.

Interest charged on late payments of tax will be the Bank of England base rate plus 2.5 and...

Only subscribers may read the full article

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.
back to top icon