VAT Deferral Scheme Open
As part of their Covid business support, the Government allowed businesses to defer the VAT due between 20 March to 30 June 2020.
If you deferred VAT between 20 March and 30 June 2020 and still have payments to make, you can:
- Pay the deferred VAT in full on or before 31st March 2021
- Opt into the VAT deferral new payment scheme
- Contact HMRC if you need more help to pay
The scheme is open to applications from now until 21st June 2021
The scheme is accessible here: https://www.gov.uk/guidance/deferral-of-vat-payments-due-to-coronavirus-covid-19
You must opt-in yourself, unfortunately, we as your agent cannot do this for you.
The Vat Deferral scheme will allow you to:
- Pay your deferred VAT in instalments without adding interest
- Select the number of instalments from 2 to 11 equal monthly payments
- The VAT balance must be cleared by 31st January 2022, and therefore the later the scheme is joined the fewer payments the balance can be spread across (i.e. commencing from March allows 11 payments, from June allows 8 payments)
We suggest that you review your expected cash flows over the coming months as the first payment can be deferred until June 2021. Although this means that repayments will be higher (as spread over a shorter time frame), it does defer the commencement date.
To use this scheme you must:
- Still have deferred VAT to pay
- Be up to date with your VAT returns
- Opt-in before the end of March 2021
- Pay the first instalment before the end of March 2021
- Be able to pay the deferred VAT by direct debit
If you opt in to the scheme, you can still have time to pay arrangement for other HMRC debts and outstanding tax.