Reduction in HMRC late payment interest rates

Following the Bank of England’s decision to reduce the base rate from 5% to 4.75%,
HM Revenue and Customs (HMRC) have announced a reduction in their late
payment interest rates.

HMRC interest rates track the base rate. Late payment interest (payable if you pay
tax late) is set at base rate plus 2.5%. Repayment interest (which HMRC pay you on
refunds or overpayments) is set at base rate minus 1%, with a minimum rate of
0.5%.

Therefore, the late payment interest rate will reduce to 7.25%. Repayment interest
will reduce to 3.75%.

The reductions come into effect from the following dates:

18 November 2024 for quarterly instalment payments; and
26 November 2024 for non-quarterly instalments payments.

See: https://www.gov.uk/government/news/hmrc-late-payment-interest-rates-to-be-
revised-after-bank-of-england-lowers-base-rate