HMRC is increasing interest rates for late payments for most taxes after the Bank of England’s decision to increase the base rate to 4.5%.

From 22 May 2023, the rate for late paid corporation tax quarterly instalment payments is 5.5%, while the rate paid on overpaid quarterly instalment payments and on early payments of corporation tax not due by instalments increases to 4.25%.

The new rate for other late paid taxes is 7%, and the repayment interest rate rises to 3.5%. These take effect from 31 May 2023.