HMRC has increased the current late payment interest rate applied to the main taxes and duties to 3% from 2.75% effective from 21 February 2022.
The 3% rate is applied to late payments for income tax, National Insurance contributions, capital gains tax, stamp duty land tax, stamp duty and stamp duty reserve tax.
The corporation tax pay and filing penalty will also rise to 3% for late payments while the repayment rate remains at 0.5%.
The rate for corporation tax self assessment, if unpaid from normal due date, will also be charged at 3%. The interest charged on underpaid quarterly instalment payments rises to 1.5% from 1.25%.
In line with the December 2021 announcement, interest paid on overpaid quarterly instalment payments and on early payments of corporation tax not due by instalments remains at 0.5%, unchanged since March 2009.