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Covid 19 VAT Payment Deferral

Date:

Did you defer your VAT payment between 20 March and 30 June 2020 and still have payments to make?

Originally HMRC gave VAT registered businesses until 31 March 2021 to pay their deferred VAT, however as the Covid 19 pandemic has continued and impacted businesses for longer than anyone could have anticipated HMRC are offering an extension to the VAT payment deferral until 31 March 2022.

VAT Payment Deferral Extension

Under the new VAT payment deferral scheme, HMRC are offering businesses that deferred their VAT payment between 20 March and 30 June 2020 the option to pay their outstanding VAT liability in equal monthly instalments interest free.

Under the new Scheme VAT deferral scheme you can choose the number of months you would like to pay your outstanding VAT liability over, up to a maximum of 11 months, however the month you join the new Vat deferral scheme will determine the maximum number of instalments that you can choose.

If you join the new VAT deferral scheme in March, you will be able to pay your deferred VAT in 11 instalments or fewer.

Below details the joining deadlines each month and the number of maximum instalments available to your business:

19 March 2021              11 months

21 April 2021                 10 months

19 May 2021                 9 months

21 June 2021                8 months

How to Join the New VAT Payment Deferral Scheme

The new VAT payment deferral scheme goes live on 23 February 2021, with a deadline for joining the scheme of 21 June 2021.

You will need to apply to join the scheme online through your businesses own HMRC gateway account, an agent or accountant cannot apply on your behalf through their HMRC account.

Your VAT affairs need to be up to date, with all prior VAT returns filed with HMRC and any historic errors corrected.

You can still have a Time to Pay arrangement for other HMRC debts and outstanding tax if you want to join the new VAT payment deferral scheme.

How to Pay Outstanding VAT

Under the VAT Payment Deferral scheme, you will need to pay your outstanding tax liability in equal monthly instalments by direct debit.

You will also need to pay your first instalment at the time of joining the scheme.

What if I Cannot Pay My Tax on Time?

If you are still unable to pay your tax on time you can contact HMRC and apply for a time to pay arrangement, however it is normal practice for HMRC to continue to charge interest on any outstanding tax liabilities.

Need Help with VAT or the New VAT Deferral Scheme? If you need advice around VAT or the extended VAT payment deferral scheme please contact us on 01708 200675, by email on info@edwardsbailey.co.uk or via our website www.edwardsbailey.co.uk.

The post Covid 19 VAT Payment Deferral appeared first on HR News.

Source: http://hrnews.co.uk/covid-19-vat-payment-deferral/

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