Penalty interest rate set to rise again
The Bank of England raised its base rate again in June, and HMRC has confirmed the penalty rate of interest on late-paid tax will follow suit. What will the new rate be and when will it start to apply?
The base rate has been increased several times already in 2022 as the Bank of England attempts to exert some control on spiralling inflation. The latest increase (on 16 June) set the rate at 1.25%. This means that HMRC’s penalty interest rate will rise to 3.75% (up from 3.5%). HMRC has confirmed that this will take effect from 27 June for quarterly instalment payments, and from 5 July for everything else.
Related Topics
-
Should you use simplified expenses?
The flat rate expense you can claim for business journeys if you’re self-employed has increased to 55p per mile. Can you use simplified expenses for motoring costs and is it more tax efficient to do so?
-
HMRC targets smaller tax debts
HMRC is stepping up collection of lower‑value tax debts, signalling a firmer approach to long‑overdue liabilities while encouraging earlier engagement. Direct recovery from bank and building society accounts has been re‑introduced on a trial basis, alongside a government consultation on HMRC powers and tax administration. What are the key points to be aware of?
-
New digital process for NI refunds
HMRC has introduced an online service to claim a refund of Class 1 NI contributions but not everyone can use it. What can you do if you've paid too much NI?