iHow it is calculated
The charge is the debt times the monthly rate times the number of months overdue (part-months are rounded up):
interest = debt × monthly rate × months
£10,000 owed at 0.65% a month for 3 months = £195 interest, £10,195 total.
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Taxes · Updated 2026
Late Payment Interest Calculator
Estimate the interest on overdue tax from the amount owed and a monthly rate. HMRC late-payment interest is 7.75% a year (base rate + 4%), about 0.65% a month.
Enter the details
£
%/mo
mo
Enter the tax owed, the monthly rate and the months overdue.
=Interest
195.00£
Tax owed10,000.00 £
Interest 0.65% × 3+195.00 £
Total to pay10,195.00 £
HMRC late-payment interest is 7.75% a year (base rate + 4%) ≈ 0.65% a month and changes with the base rate; part-months count as whole months here. Enter the current monthly rate.
Interest 195.00 £ · Total to pay 10,195.00 £Indicative figures, not advice. Rates change with the Bank of England base rate — enter the rate in force. Instant in-browser calculation, no account.
Last updated: 11 July 2026 Source: GOV.UK — HMRC
⚖︎ Results are for informational purposes and do not constitute tax advice. For specific situations, consult a licensed accountant or the relevant tax authority.
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?Frequently asked questions
What is HMRC’s late payment interest rate?
From 9 January 2026 it is 7.75% a year (Bank of England base rate + 4%), roughly 0.65% a month. It changes when the base rate moves, so enter the current monthly rate.
How is it calculated?
Interest runs daily from the due date until you pay. This tool multiplies the debt by a monthly rate and the number of months; for a day-exact figure, use the annual rate ÷ 365 × the number of days.
Is there a penalty as well?
Yes — HMRC also charges late-payment penalties (for example on VAT and Self Assessment) on top of interest. This tool covers the interest; add any penalty separately.
Monthly or annual?
HMRC quotes an annual rate. Here you enter a monthly rate and the months overdue — divide the annual rate by 12 for the monthly figure.
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