HMRC is reducing the late payment interest applied to the main taxes and duties to 7.5%.
This change will come into effect on 20 August 2024 for Corporation Tax non-quarterly instalment payments, Income Tax, National Insurance contributions, Capital Gains Tax, Stamp Duty Land Tax, Stamp Duty Reserve Tax, Inheritance Tax, Capital Transfer Tax, and Estate Duty.
In addition, the interest charged on underpaid quarterly instalment payments will decrease to 6.0% with effect from 12 August 2024.
The interest paid on overpaid quarterly instalment payments and on early payments of corporation tax not due by instalments decreases to 4.75% from 12 August 2024.
The repayment interest rate will also be reduced to 4.0% from 20 August 2024.
These reductions have been instigated by the Bank of England base rate decrease to 5.0% on 1 August 2024.