As of Tuesday 23 February 2021, HMRC have announced that a new payment scheme has been put in place because of businesses deferring VAT between March and June 2020. As a result of this, businesses are now given the option to pay their already deferred VAT in monthly instalments from March 2021.
The options available for these businesses are:
- Pay the deferred VAT in full, on or before 31 March 2021 (You do not need to contact HMRC)
- Join the VAT deferral new payment scheme (Please See Below)
- Contact HMRC if none of the above are applicable and require further assistance with payments
If you fail to act upon any of the options above, HMRC may charge interest or a penalty.
What is the VAT Deferral New Payment Scheme?
For any business wanting to partake in this newly established scheme, the online service is available now from 23 February 2021 to 21 June 2021 via the link below:
https://www.gov.uk/guidance/deferral-of-vat-payments-due-to-coronavirus-covid-19
*Please note that agents are unable to apply on behalf of their clients*
The new payment scheme will assist companies who have been affected by COVID-19 to manage their cash flow at such a difficult time.
Businesses can equally divide their payments with 2 to 11 monthly instalments, interest free.
How to be Eligible
In order to use the new payment scheme, businesses must have outstanding VAT returns which must be submitted and up to date. Payments, as previously mentioned, start from March 2021, and runs to March 2022.
For any eligible businesses who are unable to access the online service of application, please contact the following contact number for HMRC Coronavirus Helpline to join the VAT Deferral New Payment Scheme until 30 June 2021:
08000241222
More Information
The VAT deferral scheme will require a direct debit to be set up due to the online service application. These need to be completed by the authorised bank account holder.