HMRC interest rates increase again

by CIGMA Accounting, posted in General

The Bank of England’s Monetary Policy Committee (MPC) met on 10 May 2023 and voted 7-2 in favour of raising interest rates by 25 basis points to 4.5% in a move to try and continue to tackle continued inflation. This is the twelfth consecutive time that the MPC has increased interest rates with rates now the highest they have been since 2008.

This means that the late payment interest rate applied to the main taxes and duties that HMRC charges increased by 0.25% to 7%.

These changes came into effect on:

  • 22 May 2023 for quarterly instalment payments; and
  • 31 May 2023 for non-quarterly instalments payments.

The repayment interest rates applied to the main taxes and duties that HMRC pays interest on increased by 0.25% to 3.5% from 31 May 2023. The repayment rate is set at the Bank Rate minus 1%, with a 0.5% lower limit.

Source:HM Revenue & Customs| 15-05-2023
author avatar
CIGMA Accounting
CIGMA Accounting Ltd is a forward-thinking accounting and tax firm based in London, dedicated to delivering high-quality compliance, tax planning, and business advisory services to entrepreneurs, landlords, and growing SMEs. With offices in Wimbledon and Farringdon, we combine local expertise with a tech-driven approach to simplify accounting. Our services include corporation tax filing, VAT compliance, HMRC investigation support, R&D tax credit claims, capital allowances optimisation, and bookkeeping automation. What sets CIGMA apart is our ability to blend traditional accounting rigour with AI-powered systems that reduce errors, save time, and provide real-time financial insights. Our team ensures that every client - from startups to high-net-worth individuals - receives a bespoke solution aligned with their growth goals. Whether you need strategic tax planning, help with HMRC disclosures, or a full outsourced finance function, CIGMA Accounting delivers clarity, compliance, and confidence.
See Full Bio