As a result of the pandemic, VAT registered businesses were permitted to defer their VAT payments in the period from 20 March to 30 June 2020 without interest or penalties. Originally HMRC advised that the VAT debt would need to be repaid in full by 31 March, but businesses are now permitted to apply to repay this in instalments.
The online service for the new VAT deferral payment scheme comes online on 23 February 2021 and will remain open until 21 June 2021. The new scheme will allow for deferred VAT to be repaid over a maximum of 11 instalments – the earlier a company joins the scheme, then the greater number of instalments i.e. if you join in March 2021, then deferred VAT can be repaid over a maximum of 11 months.
Company directors or business owners themselves must access the new online scheme, as tax agents will not have the required authority to permit Direct Debit payments on behalf of their clients.
For further information and eligibility criteria please visit here.
You can read our previous article on this scheme here.