New corporation tax interest rates

HM Revenue & Customs (HMRC) has announced new rates of interest for underpaid and overpaid instalment payments of corporation tax, and early payments of corporation tax not due by instalments, in respect of accounting periods ending on or after 1 July 1999.

These rates take effect from 15 August 2005. The changes are the result of recent changes in market rates.

The rate of interest charged on underpaid instalment payments of corporation tax has changed from 5.75 per cent to 5.5 per cent.

The rate of interest on overpaid instalment payments of corporation tax, and on corporation tax paid early (but not due by instalments), has changed from 4.5 per cent to 4.25 per cent.