The Bank of England’s Monetary Policy Committee has announced a reduction in the base rate from 5.0% to 4.75% as of 7 November 2024. Consequently, HMRC will adjust its interest rates for late payments and repayments.
Key Changes:
- Effective Dates:
- Quarterly Instalment Payments: New rates apply from 18 November 2024.
- Non-Quarterly Instalment Payments: New rates apply from 26 November 2024.
Interest Rate Adjustments:
- Late Payment Interest: Set at the base rate plus 2.5%.
- Repayment Interest: Set at the base rate minus 1%, with a minimum floor of 0.5%.
These adjustments ensure fairness for taxpayers, encouraging timely payments and providing appropriate compensation for overpayments.