HMRC interest rates
HMRC’s interest rates on underpaid and overpaid tax and duties are linked to the Bank of England (BOE) base rate. On 7 August 2025, the BOE base rate was cut by 0.25 percentage points, to 4%.
HMRC has updated its guidance to include the new rates applying from:
- 18 August 2025 for the purpose of corporation tax quarterly instalment payments; and
- 27 August 2025 for other payments of tax and duties.
The headline rate of interest charged by HMRC on most underpaid taxes and duties will fall from 8.25% to 8% from 27 August 2025.
New HMRC Pillar 2 manual
HMRC has published a manual covering multinational top-up tax (MTT) and domestic top-up tax (DTT). MTT and DTT apply for accounting periods that begin on or after 31 December 2023.
Read the latest on Pillar 2
Spotting the signs of tax avoidance
HMRC has updated its guidance on spotting the signs of disguised remuneration tax avoidance schemes. HMRC says that the guidance has been updated to include “newer warning signs of tax avoidance schemes”.
Repayment interest for alcohol duty
Regulations have been made that set the interest rate for repayments of alcohol duty by HMRC from 1 September 2025. The government has published a policy paper that explains the circumstances in which interest will be paid and makes it clear that there is no recourse to repayment interest for alcohol duty paid prior to 1 September 2025. The government says that it will bring into effect the late payment interest provisions for the purposes of alcohol duty with an appointed day order.
International tax round-up
CFE Tax Advisers Europe has published its latest collection of tax top 5 developments, including a summary of the first session of the Intergovernmental Negotiating Committee on the proposed United Nations Framework Convention on International Tax Cooperation. CFE reports that over 100 nations participated in the discussions, focusing on dispute prevention and resolution, capacity building and technical assistance.
Tax Faculty
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