V5.363 Prescribed rate of interest

V5.363 Prescribed rate of interest

Interest is payable at the rate applicable under FA 1996 s 1971. This provision enables the Treasury to provide by regulations for the rate of interest applicable for various purposes including interest payable by HMRC and default interest payable by taxpayers2. Regulations3 made under FA 1996 s 197 may themselves specify the rate of interest or make provision for rates to be determined by reference to other rates or other circumstances4.

The rate of interest is the “reference rate” (ie the official bank rate determined by the most recent meeting of the Monetary Policy Committee (MPC)

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