VAT payment deferral (but VAT returns needed)
The government is deferring VAT payments for 3 months. If you’re a UK VAT registered business and have a VAT payment due between 20 March 2020 and 30 June 2020, you have the option to:
- defer the payment until a later date
- pay the VAT due as normal.
You will still need to submit your VAT returns to HMRC on time.
HMRC will continue to process VAT reclaims and refunds as normal during this time.
If you choose to defer your VAT payment
You must pay the VAT due on or before 31 March 2021. HMRC will not charge interest or penalties on any amount deferred as a result of the Chancellor’s announcement.
No application is needed and the ability to defer payment applies to all VAT registered businesses.
If you normally pay your VAT by direct debit, you should contact your bank to cancel your direct debit. If you are registered for online banking you may be able to do this online. Please do so in sufficient time so that HMRC do not attempt to automatically collect any VAT due when they receive your VAT return.
Making Tax Digital for VAT
HMRC understand that the impact of COVID-19 is creating extremely difficult times for all. As a result, they are now providing all businesses that should be compliant with Making Tax Digital for VAT rules more time to put in place digital links between all parts of their functional compatible software. This means that all businesses now have until their first VAT return period starting on or after 1 April 2021 to put these digital links in place.
More information about can be found at: