EXPLANATORY NOTE
(This note is not part of the Regulations)
These Regulations specify the rates of interest which have effect for the purposes of sections 101 and 102 of the Finance Act 2009 which deal respectively with interest on sums payable to Her Majesty’s Revenue and Customs (“HMRC”) and interest on sums payable by HMRC.
The interest rates set by the Regulations are determined by reference to the official bank rate as announced at the most recent meeting of the Bank of England Monetary Policy Committee.
Regulation 3 sets the interest rate on sums payable to HMRC.
Regulation 4 sets the interest rate on sums payable by HMRC and provides a minimum rate of interest.
Regulation 5 provides for initial rates of interest that will apply on the coming into force of these Regulations.
Regulation 6 provides that where the respective interest rates change the revised rate has effect from the date of the change in relation to interest which began to run before the effective date of the change as well as interest beginning to run on or after the date of the change.
A full Impact Assessment covering the introduction of the harmonised interest regime entitled “Working towards a harmonised regime for interest and meeting the obligations to file returns and pay tax on time” was published on 14th April 2009 and is available at www.hrmc.gov.uk/better-regulation/ia.htm