VAT deferral payment scheme launches

If your business deferred its VAT payments from 20 March - 30 June 2020 and is unable to pay in full by 31 March 2021, you may be able to apply to a new VAT deferral payment scheme from tomorrow (23 February 2021).


 

The scheme, which will be open for applications up until 21 June 2021, allows businesses to pay its deferred VAT by splitting it into smaller monthly instalments, interest-free.

Businesses will be able to make up to 11 monthly instalments, but the total amount must be paid by the end of March 2022.

Precise details of the online sign up process haven't been released yet; however, businesses on the VAT Annual Accounting Scheme or Payment on Account Scheme will be invited to join the scheme later in March 2021.

HMRC has published a summary of the scheme, including a useful checklist for businesses here.

If you are unable to pay all deferred VAT in full by 31 March 2021 or sign up to the new payment scheme, you must contact HMRC on 0800 024 1222 by 30 June 2021. Failure to do so may result in interest or late payment penalties being charged.

If you have any queries or need advice, please call your usual Richardson Swift contact on 01225 325580.