HMRC announces changes to interest on late tax payments

Date: 18th September 2009

The level of interest charged by HM Revenue and Customs (HMRC) on late tax payments is to be pushed up to three per cent, it has been announced.

The government has confirmed that it is to push levels of interest by at least 0.5 per cent, despite the fact that the Bank of England recently voted to keep the base rate of interest at an historic low.

Changes, which come into effect on September 29th, will apply to late payments of corporation tax, with numerous small businesses across the country likely to be affected by the move.

At the same time, HMRC has announced that it is to start taking interest into consideration when working out tax overpayments.

While small business owners and individuals used to miss out financially due to being overcharged on their tax, the government will now pay interest of up to 0.5 per cent when making refunds.

Meanwhile, HMRC is still warning taxpayers over a fresh round of scam emails purporting to be from the government department and advising recipients that they are eligible for a refund.