Interest on Early Personal Tax Payments

Hi All, Quick question re interest on early tax payments, I'm aware of the current rate on such payments being 4.25% from HMRC's site, but what I can't find is how and when this would be applied? If I pay for sake of argument £1,000 of tax a month early, presumably the interest earned on this from HMRC is £1,000 x (4.25% / 12), but when and how is this credited? Is it simply used by HMRC as credit against tax liability for the following period? Or is it credited on the date at which the tax is due (and therefore the number of days in advance it has been paid are known)? Also, is such interest itself taxable, so that as a higher rate tax payer, you'd have to book the interest as income and pay 40% on it? Essentially wondering whether it's better to keep the money in my bank account and earn interest there until the last possible moment, or pay it early to HMRC and earn the interest there. Many thanks

Hi,
If any supplement is due on a payment this will be calculated when the payment is allocated.
If no balance due then the payment will show as a credit on your account.
You would need to decide for yourself when you make the payment but normally you would receive better interest rates at your bank.  
Thank you.

I understand that hmrc pays 4% currently on credit balances on personal tax accounts? Does it make sense to pay the tax now and not wait till January? If this interest is not taxable, then the rate is effectively better than I can get in a normal savings account. (I'm a higher rate tax payer, so any interest earned there is taxable at 40% - earn more than the £500 savings allowance). Is my reasoning correct?

Hi
Please see full details on early/late repayments HMRC interest rates for late and early payments