Last year HMRC introduced the COVID-19 VAT Deferral Scheme for all UK businesses. This scheme allowed firms to defer their VAT payments between 20 March 2020 and 30 June 2020.
As we approach 31 March 2021, businesses are required to now pay their deferred VAT liability, however HMRC have announced some additional options to further assist businesses due to the ongoing disruption caused by COVID-19 and its continuing impact on taxpayers.
Under this new scheme you can pay your deferred VAT in interest-free equal instalments, to finally settle the whole liability by March 2022. You can also opt to choose the number of instalments you pay (from 2 to 11 payments) depending on when you register for the scheme.
The month you decide to join the scheme will determine the maximum number of instalments that are available to you. For instance, if you join the scheme this month, you will be able to pay your deferred VAT in 11 instalments or fewer.
The monthly deadlines are shown below:
|If you join by||Number of instalments available to you|
|19 March 2021||11|
|21 April 2021||10|
|19 May 2021||9|
|23 June 2021||8|
You may be charged interest, or a penalty, if you do not pay the deferred VAT in full by 31 March 2021 or opt into the new scheme by 21 June 2021.
We’ve received positive feedback from many of our current clients applying to register for the scheme, as they have discovered it is a quick and easy process to register.
If you’re looking to find out more details about the scheme, please get in touch with us via our contact us page or reach out to your usual Lubbock Fine contact.