HMRC lowers interest rates for late tax payments

HM Revenue & Customs has announced that interest rates for late payment of taxes will fall one percentage point to 6.5% from 6 November.

At the same time, interest rates charged on overpaid tax, including income tax and national insurance contributions, will fall from 3% to 2.25%.

The move comes in advance of Friday's deadline for self-assessment tax returns on paper and will come as little comfort to those who have not completed returns.

The HMRC retains the power to imprison debtors as well as imposing hefty fines on businesses that have not filled complete tax returns.