HMRC has announced increases to the interest charged on tax debt after the Bank of England (BoE) raised the base rate to 5% last month.
Customers with outstanding tax debt will see interest on their late payments rise from 7% to 7.5%.
HMRC will also pay a higher rate to taxpayers who overpaid their taxes or paid too early, with repayment interest set to increase from 3.5% to 4%.
Affected taxes include income tax, National Insurance contributions and capital gains tax.
The changes for quarterly instalment payments will apply from 3 July, while interest on other instalment payments will increase on 11 July.
HMRC calculates late payment interest rates as the base rate plus 2.5%, which, according to the tax authority, encourages "prompt payment" and "ensures fairness" for those who pay their tax on time.
The rate of interest on overpayment of tax is calculated as the base rate minus 1%, "fairly compensating" taxpayers for loss of use of their money.
HMRC continued:
"The differential between late payment interest and repayment interest is in line with the policy of other tax authorities worldwide and compares favourably with commercial practice for interest charged on loans or overdrafts and interest paid on deposits."
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