Back in March, we told you about the Governments plans to allow businesses to defer payment of their VAT bills. The measure was a response to the covid-19 crisis and an attempt to reduce the financial impact of the pandemic on businesses and boost the economy.
The process was fairly straightforward - businesses could choose to pay what they owed in smaller monthly instalments, interest-free. There was a range of 2-11 monthly payments to choose from and the number depended on when you joined the scheme. The earlier you joined up, the more instalments were available.
Did you defer payment of your VAT bills between 20th March 2020 and 30th June 2020 until 30th June 2021?
If you deferred payment of your VAT bills between 20th March 2020 and 30th June 2020 until 30th June 2021, then you need to be aware of the following information and your options.
To avoid a 5% penalty, you need to pay the VAT in full by 30th June 2021. If you feel that you are unable to do this there are a couple of options available to you:
You can opt into the new VAT deferral payment scheme which will close for applications on 21st June 2021.
You can make an alternative arrangement with HMRC by 30th June 2021 – however, this option will result in interest being charged by HMRC.
Obviously, if you didn’t defer your VAT payment then this does not apply to you.
If you would like some advice on your options regarding the upcoming VAT deferral deadline, get in touch. We are a Nottingham based accountants with an office in West Bridgford. We work with both businesses and individuals throughout the UK.
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