Did you know that the deadline for paying any deferred VAT is the end of this month? There are options available to you if you can't pay in full, which could save you a 5% penalty from HMRC ...
Don't forget the Deferred VAT deadline is only a few weeks away!
The government announced the Deferred VAT scheme early on in the coronavirus pandemic, and any VAT payable between the 20th of March 2020 and the 30th of June 2020 could be deferred. Originally this was until the 31st of March 2021, but last September, the Chancellor announced an extension until the 30th of June 2021.
"Repay your Deferred VAT or arrange to pay in instalments!"
So, you must make arrangements with HMRC and get this sorted out as soon as possible to save you a 5% penalty and the possibility of having to pay interest on the amount as well.
Here are your options:
Pay the deferred VAT in full by the 30th of June 2021
Opt into the VAT Deferral New Payment Scheme (on or before the 21st of June 2021)
Make alternative arrangements before the 30th of June to pay HMRC
If you choose to pay in full, then HMRC has confirmed there will be no penalties or interest applied to the amount. If you want to join the VAT Deferral New Payment Scheme, then you can do this online via the Government Gateway or by phoning HMRC on 0800 024 1222.
However, do note that on joining the scheme, the first payment is immediately due, and there are a number of other pre-requisites like being up to date with your VAT return filings and paying instalments by Direct Debit.
If you are unable to meet the criteria, then calling HMRC as soon as possible and making alternative arrangements to pay will save you penalties, although interest may be charged.
Until next time ...
ROGER EDDOWES Business Godparent
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Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
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