Part 6: Administration and enforcement Section 52: Rate of interest applicable to judgment debts etc. in taxation matters Background note
The government wishes to ensure that where HMRC is party to a tax-related debt, the rates of interest are those contained in tax legislation, whether the debt follows from court action or not. It is appropriate for interest rates on judgment debts relating to tax matters to be determined in tax legislation rather than the Judgments Act 1838 or County Courts Act 1984, which are the responsibility of other government departments such as the Ministry of Justice.
	This change in rates applies to cases both where HMRC receives judgment interest where it has won a case, and where it pays judgment interest where it has lost a case.
	The government is making this change for two reasons. First, to ensure that where HMRC is party to a tax-related debt, the rates of interest are those contained in tax legislation, whether the debt follows from court action or not. This will provide consistency in how the law applies. Second, to ensure that the rates of interest on such debts are set at an appropriate level.