As the deadline looms for VAT deferred between 20 March and 30 June 2020 to be paid, we detail below the options that you currently have to settle the liability.

Essentially, you can pay now or get ready to opt in to the VAT deferral new payment scheme

 

  1. What Are My Options?

If you deferred VAT between 20 March and 30 June 2020 and still have payments to make, you can:

  • pay the deferred VAT in full on or before 31 March 2021
  • opt in to the VAT deferral new payment scheme when it launches in 2021
  • contact HMRC if you need more help to pay

 

  1. What If I Want To Opt In To The New Payment Scheme
  • Firstly you cannot opt in yet.
  • The online opt in process will be available shortly.
  • You must opt in yourself, we cannot do this for you
  • What Do I Gain From Opting In?
  • Instead of paying the full amount by the end of March 2021, you can make up to 11 smaller monthly instalments, interest free.
  • All instalments must be paid by the end of March 2022
  • You select the number of instalments from 2 to 11 equal monthly payments
  • Am I Eligible For The Scheme?
  • To use this scheme you must:
    • Still have deferred VAT to pay
    • be up to date with your VAT returns
    • opt in before the end of March 2021
    • pay the first instalment when you opt in
  • What If I Have Other Time To Pay Arrangements?
  • You can still have a time to pay arrangement for other HMRC debts and outstanding tax.
  • Can I Prepare Now To Opt In To The New Payment Scheme
  • You will need to use your own Government Gateway account; so if you have not set up one it is time to do so on-line https://www.gov.uk/log-in-register-hmrc-online-services
  • submit any outstanding VAT returns from the last 4 years. You will not be able to join the scheme if you have not done so
  • make sure you know how much you owe, including the amount you originally deferred and how much you may have already paid
  • consider the number of equal instalments you’ll need, from 2 to 11 months

 

  1. What If I Am Not Able To Pay My Deferred VAT
  • If you are unable to pay the VAT due and need additional time to pay, you should contact HMRC before the payment is due.
  • For help, either
    • Contact Lisa Garfinkle (lisag@barrons-bds.com) at Barrons who will be able to assist you and contact HMRC on your behalf if you prefer, or
    • Contact HMRC direct by
      • Using the GOV‌‌.UK website and search for ‘If you cannot pay your tax bill on time’, or
      • Call 0300 200 3835.

Barrons has put together a helpful guide to running your business during the coronavirus crisis.