Deferred VAT Update

In March 2020 the government announced a VAT deferral scheme which enabled businesses to defer any VAT due between 20 March – 30 June 2020 until 31 March 2021.

With the new deadline fast approaching, HMRC has announced the repayment options available to businesses. 

Options:

• Pay the deferred VAT in full, on or before 31 March 2021
• Join the new VAT deferral payment scheme which will be open between 23 February – 21 June 2021
• Contact HMRC by telephone on 0800 024 1222 by 30 June 2021 if you need more time to pay

Penalties & interest may be charged if you do not pay the deferred VAT in full by 31 March 2021, opt into the new scheme by 21 June 2021 or agree time to pay with HMRC by 30 June 2021. 

Further Details:

Pay VAT in full: You can pay the deferred VAT in full here: https://www.gov.uk/pay-vat. You will not need to contact HMRC if you chose this option.

Join new deferral scheme: The scheme will open between 23 February – 21 June 2021 and will let you pay the VAT in equal instalments by direct debit. The number of instalments depend on when join the scheme. The earlier you join, the more instalments available. 

Terms:

• You must join the new scheme yourself – this is because a direct debit needs to be set up and accountants do not have the authority to set up payments on behalf of your business
• You must join by the 21 June 2021. We advise clients to join sooner to obtain a higher number of instalment options
• You must pay the first instalment when you join
• If you want to join but cannot pay by direct debit, please call HMRC on 0800 024 1222
• You must have a Government Gateway account
• All outstanding VAT returns from the last four years must be submitted

As always, please get in touch if you want to discuss anything further.