HM Revenue and Customs does not hold a central dataset that identifies how many instances of Late Payment Interest (LPI) have been charged for all tax heads.

For some tax heads, such as Income Tax Self Assessment, it would be possible to produce such figures, but due to the disproportionate cost to the taxpayer, it is not possible to answer this question. This cost represents the time it would take an analyst to extract, combine, analyse and quality assure the data.

For other tax heads, even with additional time and resource, it would not be possible to isolate how many instances of LPI have been charged, due to the way that data is stored for those tax heads.

HM Revenue and Customs does not hold a central dataset that identifies how many instances of Late Payment Interest (LPI) have been charged for all tax heads.

For some tax heads, such as Income Tax Self Assessment, it would be possible to produce such figures, but due to the disproportionate cost to the taxpayer, it is not possible to answer this question. This cost represents the time it would take an analyst to extract, combine, analyse and quality assure the data.

For other tax heads, even with additional time and resource, it would not be possible to isolate how many instances of LPI have been charged, due to the way that data is stored for those tax heads.

As announced at the Budget in 2024, HMRC amended legislation to increase the late payment interest rate by 1.5 percentage points (ppts). This changed interest rates from Bank of England base rate + 2.5 ppts to base rate + 4 ppts.

This change took effect as HMRC’s current interest was low when compared to commercially available short-term borrowing. This creates unfairness between those who pay on time and those who choose not to, using HMRC as a form of cheap lending.

The measure aimed to address this by bringing HMRC’s rates closer to those commercially available. The late payment interest rate increase was made to encourage taxpayers to pay on time, help raise vital revenue for public services, and ensure fairness for those who pay on time.

These changes took effect from 6 April 2025 and are applied where interest is charged to existing and new tax debts owed to HMRC.

This measure encourages people to pay the outstanding tax they owe, increasing incentives to engage with HMRC and make payment arrangements, as well as complying to avoid late payment penalties.

There is no proposal to publish any analysis or evidence as HMRC continues to keep its interest rates under review.

HMRC does not routinely collect or publish data on the extent to which Corporation Tax late-payment interest arises from differences between estimated and final tax liabilities, as opposed to late payment behaviour. No specific assessment has therefore been made of the relative contribution of these factors.

Interest on tax paid late is not a penalty but rather designed to both compensate the Exchequer for late payment and to provide a measure of fairness to those taxpayers that pay what is due on time.

The Government recognises that some businesses may face greater uncertainty when estimating their final Corporation Tax liability. The Corporation Tax regime has nevertheless operated successfully for many years using broadly consistent interest rules.

HMRC keeps all aspects of the tax administration framework under review. In doing so, it is mindful of the need to avoid unnecessary complexity and to ensure that rules work effectively across the wide range of businesses that make up the Corporation Tax population. HMRC has not identified evidence that introducing different late-payment interest regimes for particular sectors, activities or business types would improve fairness or deliver better overall outcomes. The Government therefore continues to apply a broadly consistent approach across taxpayers while keeping the operation of the regime under review.

HMRC treats interest in line with other tax authorities and financial institutions by having a differential between the interest it pays, and the interest charged. This differential is currently 5ppt, with both Repayment Interest and Late Repayment Interest linked to the Bank of England base rate that reflects wider economic conditions and gives transparency for those tracking its rates.

In setting rates, HMRC weighs up various factors to provide transparency and ensure fairness for those who do pay on time, the cost to the public purse of delayed payment, and increasing the tax debt.

The differential between late payment and repayment rates supports appropriate compliance incentives within the tax system. This makes sure that HMRC does not become the lender of first preference to some customers, impairing its ability to efficiently collect taxes and fund public services.

This also ensures taxpayers do not benefit from delaying payment by effectively borrowing from HMRC at lower rates than are available through commercial short‑term lending. It also avoids creating incentives to overstate tax to secure a financial return compared with commercial savings rates.

HMRC treats interest in line with other tax authorities and financial institutions by having a differential between the interest it pays, and the interest charged. This differential is currently 5ppt, with both Repayment Interest and Late Repayment Interest linked to the Bank of England base rate that reflects wider economic conditions and gives transparency for those tracking its rates.

In setting rates, HMRC weighs up various factors to provide transparency and ensure fairness for those who do pay on time, the cost to the public purse of delayed payment, and increasing the tax debt.

The differential between late payment and repayment rates supports appropriate compliance incentives within the tax system. This makes sure that HMRC does not become the lender of first preference to some customers, impairing its ability to efficiently collect taxes and fund public services.

This also ensures taxpayers do not benefit from delaying payment by effectively borrowing from HMRC at lower rates than are available through commercial short‑term lending. It also avoids creating incentives to overstate tax to secure a financial return compared with commercial savings rates.

The government is capping the maximum interest rates on Plan 2 and 3 student loans at 6% for the 2026/27 academic year. We are clear it does not resolve all of the issues with the Plan 2 system, which was designed and implemented by the previous government. We are considering how to make the system fairer, but to be fiscally responsible we must consider how any change would be funded.

The information requested is not held centrally. Trust accounts data is published online, along with a breakdown of the Unitary Charge payments, including interest payments, at the following link:

https://www.england.nhs.uk/financial-accounting-and-reporting/nhs-providers-tac-data-publications/

Repayments made against accrued interest are not separated from repayments made against the borrowed portion of the loan.

The department publishes an estimate of the subsidy portion of student loan outlay in the form of the Resource Accounting and Budgeting (RAB) charge. The RAB charge for Plan 2 outlay in England in 2024/25 was 32%.

The RAB charge is calculated as the present value of student loan outlay less expected future repayments, discounted by inflation plus the financial instrument discount rate. Expectations of interest, write offs and the government’s borrowing costs are factored into the fair value of student loans on issuance. In valuing the loan book at financial year end, estimated operational costs of servicing student loans are accounted for, in accordance with International Financial Reporting Standards. Higher interest relative to inflation reduces the forecasted cost of the loan system due to increased future repayments.

The department does not hold analysis of the impact on the number of additional years of repayment for Plan 2 borrowers attributable to the level of interest charged.

The Department has engaged with a range of relevant stakeholders to help shape policy proposals. We have engaged with firms that undertake legal aid work, as well as representative bodies, through bilateral engagement, legal aid providers’ roundtables and our recent consultation.

We have also been working with relevant experts to consider the potential impacts of an ILCA scheme and the consultation collected evidence on the administration of the scheme and regulatory challenges.

We are currently considering all the evidence received through engagement as part of our ongoing policy development and consultation response.

The Department has engaged with a range of relevant stakeholders to help shape policy proposals. We have engaged with firms that undertake legal aid work, as well as representative bodies, through bilateral engagement, legal aid providers’ roundtables and our recent consultation.

We have also been working with relevant experts to consider the potential impacts of an ILCA scheme and the consultation collected evidence on the administration of the scheme and regulatory challenges.

We are currently considering all the evidence received through engagement as part of our ongoing policy development and consultation response.

Interest on Lawyer’s Client Account schemes have been successfully employed in several international jurisdictions for decades. As part of developing this proposal, the Ministry of Justice has undertaken extensive research and engagement with experts, officials and administrators from several international comparators. This includes schemes in Australia, Canada, France and the USA.

The Government is committed to the biggest expansion of legal aid in a generation as part of the Hillsborough Law and are investing millions on reforming the courts system through unlimited sitting days and better maintaining courts to deliver a world-class justice system.

Funding from an Interest on Lawyers’ Client Accounts (ILCA) scheme will play a crucial role in achieving these priorities from 2028/9 onwards.

The Government has published a consultation on ILCA that closed on 9 March 2026, including how income from such a scheme might be invested. We will carefully consider all responses and provide an official response.

HMRC provides guidance on the interest applied to tax that is paid late, and on the repayment interest paid when taxpayers are owed money. The rates and explanatory information are published on GOV.UK and reviewed regularly to ensure they remain accurate, accessible and up to date.

Details of HMRC’s current interest rates for late and early payments are available here: https://www.gov.uk/government/publications/rates-and-allowances-hmrc-interest-rates-for-late-and-early-payments/rates-and-allowances-hmrc-interest-rates

For customers who need extra help, including those who are vulnerable or digitally excluded, HMRC provides dedicated tailored support through their Extra Support Team. They can offer additional assistance over the phone and help customers understand what interest applies and why.

Anyone worried about meeting their tax obligations on time should contact HMRC as early as possible to discuss options, such as setting up a time to pay arrangement.

Schedule 2 of the CIL Regulations 2010 (as amended) requires authorities to report on the total amount of developer contributions received, spent, allocated and retained through CIL and section 106 at the end of the reported year.

CIL receipts collected, which includes any late payment interest and surcharges paid by a developer, must be used for the purposes which are set out in section 216 of the Planning Act 2008 and Part 7 of the CIL Regulations.

Further to the answers provided to Questions UIN 84954 and 54059 on 4 November 2025 and 6 June 2025 respectively, the Planning Advisory Service has recently published additional resources on its website to support local planning authorities in their infrastructure planning and delivery.