How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask bigduckontax Your Own Question
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 4808
Type Your Tax Question Here...
bigduckontax is online now

what is the rate of intest paid on unpaid income tax and how

Customer Question

what is the rate of intest paid on unpaid income tax and how is it calculated
Submitted: 3 years ago.
Category: Tax
Expert:  bigduckontax replied 3 years ago.
Hello, I'm Keith and happy to help you with your question.

Here is the current HMRC release [edited] on the subject:

'The current late payment and repayment interest rates applied to the main taxes and duties that HMRC currently charges and pays interest on are:

Late payment interest rate - 3.0% from 29 Sepetember 2009

Repayment interest rate - 0.5 of 1% from 29 September 2009'

Interest charged or paid is simple interest, not compound.

I do hope I have helped in answering your question.
Customer: replied 3 years ago.

is it calculted on a daily or anual basis eg £1000 unpaid tax for 1 year how much intrest would be paid

Expert:  bigduckontax replied 3 years ago.
Daily, but the rate is per annum so for a year with 1K owing the interest would be a mere 30 quid.

Please remember that penalties might be charged on top of this for various reasons eg late returns.