HMRC tax collection Archives - WRLO Accountants

HMRC cuts late payment interest rate to 8%

WRLO Accountants — Mon, 25 Aug 2025 16:13:34 +0000

HMRC will reduce late payment and repayment interest rates from 27 August following the 0.25% cut in the base rate earlier in the month. The Bank of England cut the base rate to 4% on 7 August, triggering a 0.25% cut in HMRC interest rates which are pegged to the base rate. From 27 August, the late payment interest rate will be cut to 8.0% from 8.25%. The repayment interest rate will be cut to 3% from 3.25% from 27 August. HMRC late payment interest is set at base rate plus 4%. Repayment interest is set at base rate minus 1%, with a lower limit – or ‘minimum floor’ – of 0.5%. Following the cut to the base rate, Tina McKenzie, Policy Chair at the Federation of Small Businesses (FSB), said: ‘The small business community will now look to lenders to reflect this rapidly across their offering, cutting the cost of finance. They will also want to see the Bank of England set out a clear path for the rest of the year, with a further easing in the base rate badly needed to reduce the financial strain they are under. ‘There will be no growth in the economy overall […]

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HMRC targets personal expenditure on self assessment

WRLO Accountants — Mon, 25 Aug 2025 15:48:42 +0000

HMRC will run a digital campaign to ensure that self assessment taxpayers do not claim tax relief for personal expenditure on 2025/26 tax returns, according to the Institute of Chartered Accountants in England and Wales (ICAEW). HMRC has told the ICAEW that the digital campaign follows a trial in 2024. This trial generated over £27 million in tax revenue and ‘highlighted reporting of disallowable private use in business expenditure’. HMRC says that it will be opening more enquiries to check that sole traders, partners and landlords only claim deductions for business-related expenses. This includes ensuring that mixed use expenses are apportioned correctly between business and personal use, which considers the circumstance of the particular tax year. The legislation states that in order for an expense to be deductible, it must be ‘incurred wholly and exclusively for the purposes of the trade’. Where an identifiable part of an expense is incurred for trade purposes, that part of the expense is an allowable deduction. It is important that the method of apportionment used is: supported by records (eg, mileage records); and applied consistently from one tax year to the next. It must also be the case that the expense is not capital […]

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HMRC sends side hustle warning

WRLO Accountants — Fri, 04 Jul 2025 17:57:12 +0000

HMRC is warning those earning extra income through a side hustle to check if they need to register for self assessment and file a tax return. Side hustles can be any additional income stream, from online selling to content creation, from dog walking to property rental. It also includes gains or income received from cryptoassets. Anyone who earns over the £1,000 threshold may need to register for self assessment and complete a tax return. There is a checker tool on GOV.UK for those who aren’t sure if they meet the criteria. If they do and are new to self assessment they will need to register to receive their Unique Taxpayer Reference. Guides for side hustlers can also be found at taxhelpforhustles.campaign.gov.uk. Myrtle Lloyd, HMRC’s Director General for Customer Services, said: ‘Whether you are selling handmade crafts online, creating digital content, or renting out property, understanding your tax obligations is essential. If you earn more than £1,000 from these activities, you may need to complete a self assessment tax return. ‘Filing early puts you in control – you will know exactly what you owe, can plan your payments, and avoid the stress of the January rush. You don’t need to pay immediately […]

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