Tax Collection and Management (Wales) Act 2016 section 163

Rates of late payment interest and repayment interest

Section 163 deals with how the Welsh Ministers set the interest rates that apply when tax is paid late (late payment interest) and when WRA repays tax that has been overpaid (repayment interest).

• The Welsh Ministers set both the late payment interest rate and the repayment interest rate through regulations.
• The regulations may specify a fixed rate or link the rate to an external reference rate (such as the Bank of England base rate), allowing it to change automatically over time.
• The regulations can adjust rates up or down using set amounts or formulae, and can round rates derived from averages.
• When a rate changes, the regulations can apply the new rate to interest that is already running, not just to interest that starts from the date of the change.