Chapter 6 - Interest on Late Paid Tax and Repayments

Question 1

Interest

Answer 1

Interest runs from the due date for payments to the actual date of payment where CT is paid late. This applies to all payments for co’s small or large.

Question 2

Interest Rate

Answer 2

Rate HMRC charges is 2.5% + bank base rate

Question 3

Repayments

Answer 3

Overpaid tax receives repayment interest at a rate of a bank rate minus 1% (min rate of 0.5%)

Question 4

Treatment

Answer 4

Interest received is non-trade profit.

Interest paid is interest paid on non-trading loan and can be deducted from non-trade profit