Deferral of VAT Payments
The Government have also announced the deferral of VAT payments for 3 months from 20 March 2020 until 30 June 2020 to assist their cash flow.
What does this mean?
It means that you do not need to pay your current quarter vat liability on the due date which usually is a month and seven days after the end of the period. If you have a direct debit arrangement with HMRC VAT, please cancel it to get the benefit out of this deferred payment arrangement.
What to do?
- This deferral will be automatic, however it is unclear whether HMRC will automatically suspend collection of direct debit payments of VAT during this period so we suggest that you cancel your direct debit mandate but remember to set it up again in due course.
- Businesses have until the end of the 2020/21 tax year to pay any VAT liabilities that accumulate.
- VAT refunds and reclaims will be paid by the government as normal. Businesses should continue to file their VAT returns by the due date to avoid penalties.
Who is Eligible?
All VAT registered traders are eligible. If you need any further explanation or have any queries, please do not hesitate to contact us.