How does the base rate rise impact on HMRC’s rates?

A summary of interest rate increases

IP image

On 15 December 2021, the Bank of England increased the base rate from 0.10% to 0.25%. As HMRC’s interest rates are linked to the Bank of England base rate, HMRC has increased the current late payment interest rate applied to the main taxes and duties to 2.75% from 2.60%. The rise affects all other HMRC late payment rates with an across-the-board increase of 0.15% to 2.75%.

These interest changes came into effect on:

  • 27 December 2021 for quarterly instalment payments
  • 4 January 2022 for non-quarterly instalment payments.

However, the repayment interest rate of 0.5% will remain unchanged since it was introduced in September 2009.

Read the full list of HMRC current and historical rates.