Highlights from the broader tax news for the week ending 22 June 2022, including: an increase to late payment interest rates; and a review of the SAYE bonus mechanism.
HMRC increases late payment interest ratesAs HMRC interest rates are linked to the Bank of England base rate, the increase in the base rate from 1% to 1.25% on 16 June 2022 has triggered an increase in rates for late payments of tax. Rates will increase from 27 June 2022 for quarterly instalment payments (QIPs). Late payment interest for other payments is increased from 3.5% to 3.75% from 5 July 2022.
The rate of interest paid by HMRC on repayments (other than QIPs) remains unchanged at 0.5% as this rate is calculated as the higher of:
• 0.5%; and
• the Bank of England rate minus one.
SAYE bonus rate mechanism reviewThe June 2022 edition of HMRC’s Employment Related Securities Bulletin highlights HMRC’s review of the Save as You Earn (SAYE) bonus rate mechanism. Bonus rates are fixed when an individual enters a SAYE contract. Rates have been set at 0% since December 2014 and will be held at 0% from 30 June 2022 while the review is being undertaken. Normally, the three- and five-year bonus rates are adjusted automatically by linking them to the three- and five-year swap rates (sterling bid rates) quoted in the Financial Times. The Specimen SAYE prospectus has been updated to reflect this review.
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