HMRC has released information for businesses due to make a VAT payment between 20th March 2020 and 30th June 2020. This is to help businesses manage their cash flow during this period.

For VAT registered businesses with a payment due between these dates, there are two options:

  1. defer the payment until a later date
  2. pay the VAT due as normal

The payment deferral does not cover VAT MOSS payments.

HMRC will not charge interest or penalties on any amount deferred.

If you decide to defer your payment, you must make the payment to HMRC by 31st March 2021. There is no need to inform HMRC of your decision to defer.

Businesses which pay by direct debit will need to speak to their bank or use online banking services to cancel the direct debit so that their payment isn’t collected.

However, you will still need to submit your VAT returns to HMRC on time.

After the deferral period ends, businesses will need to pay their VAT as usual. HMRC will release information soon regarding payment of deferred VAT.

HMRC will continue to process VAT reclaims and refunds as usual during this time.

You can find the full notice from HMRC here.

If you’re in temporary financial distress because of COVID-19

If you are experiencing financial difficulties, more help is available from HMRC’s Time to Pay scheme.

Stay up to date

HMRC share news and updates regularly on their Twitter account. Keep up to date with the latest information by following their account here.

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