Permanent increase to penalty interest rates
The new tax year saw a change to the way interest on late paid taxes is calculated. What’s changed and what are the new charges?
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Deadline to pay Class 1B NI
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Company owners' personal tax affairs under scrutiny
Company owners are being urged to check their personal tax affairs as a new compliance campaign focuses on transactions between limited companies and the people who control them. Loans, personal expenses and the use of company assets are among the areas attracting attention. Could you have overlooked a tax liability?
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HMRC speeds up National Insurance refunds
HMRC has confirmed that it is using a new automated process to speed up National Insurance refunds. Where its records suggest that someone may have overpaid, HMRC will write to them asking them to check their employment and contribution details before any refund is processed. Could you be due money back?
Prior to 2025/26, interest was charged at the Bank of England base rate plus 2.5% on most underpaid taxes. In a push for unpaid tax bills to be settled, it was announced at the 2024 Autumn Budget that this would change to the base rate plus 4% from 6 April 2025. The government says the rate of late payment interest encourages prompt payment and ensures fairness for those who pay their tax on time.
From 6 April 2025 the following rates apply:
- Late corporation tax paid quarterly - 7%
- Late payment interest on other taxes - 8.5%
There is no corresponding change to the way repayment interest rates are calculated, i.e. the base rate minus 1%, with a lower limit of 0.5%.
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