The Isle of Man Treasury announced a reduction in interest rates applied to VAT and other indirect taxes, effective 25 February 2025, lowering both the late payment and repayment rates. The change follows a reduction in the Bank of England base rate to 4.5% from 4.75% and related changes to United Kingdom late payment interest rules, with the Isle of Man aligning its VAT and indirect tax administration with the United Kingdom under an existing agreement. From 25 February 2025, the late payment interest rate will be 7% and the repayment interest rate will be 3.5%; taxpayers who pay on time will not incur late payment interest, while overpayments may attract repayment interest.
The Treasury (Isle of Man) 2025-02-06
Isle of Man Treasury lowers VAT late payment interest to 7% and repayment interest to 3.5% from 25 February 2025
The Isle of Man Treasury will reduce interest rates on VAT and other indirect taxes effective 25 February 2025, aligning with the UK's recent adjustments following the Bank of England's base rate cut to 4.5%. The late payment interest rate will be set at 7%, and the repayment interest rate at 3.5%. Timely taxpayers will avoid late payment interest, while overpayments may earn repayment interest.