HMRC will support business throughout the financial downturn brought about by the Coronavirus (Covid-19) pandemic.
Please note that the measures outlined below are in addition to the normal HMRC ‘time to pay’ scheme which allows businesses to agree an extended time period over which to repay HMRC taxes.
All VAT payments due to be collected between 20 March and 30 June 2020 have been deferred. HMRC have confirmed that no interest or penalties will arise on payments not made during this period.
VAT payments deferred must be paid over to HMRC by 31 March 2021.
Claims for VAT refunds will be processed in the normal way.
Key point – make sure you do two things in relation to VAT:
- File your VAT returns with HMRC as usual. HMRC cannot defer payments until the debt is ‘live’ on their system so it is vital to keep your filings up to date.
- Cancel your VAT direct debit to HMRC . This should be reinstated after 30 June 2020.
On 31 July 2020, taxpayers registered for Self Assessment would be due to make their second payment on account for the 2019/20 tax year,
HMRC have now deferred this payment until January 2021. There is no process to avail of this support, it is an automatic deferral with no interest or penalties arising on payments not made.
Note – for taxpayers eligible for this payment deferral, this will give rise to a much higher payment due by 31 January 2021. Cash-flow should be planned out accordingly.
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