There is less than one month to go for businesses that deferred VAT payments last year to join the online VAT Deferral New Payment Scheme.
The scheme allows businesses that deferred VAT due from 20 March to 30 June 2020 to make their VAT payments in in monthly instalments. Businesses that have deferred VAT but not yet joined the scheme should note that HMRC’s online portal closes on 21 June 2021.
How does the scheme work?
The scheme requires a Direct Debit to be set up as part of the online joining process. Please note that this must be done authorised bank account holder.
Businesses joining the scheme will not be charged a penalty and will be able to pay their deferred VAT in two to eight interest-free instalments.
There are several requirements for joining the scheme, including being up to date with filing VAT returns and agreeing to pay the instalments by direct debit.
What happens if I don’t join the scheme?
Businesses who have deferred VAT payment but fail to sign up for the scheme can be charged a 5% penalty. To avoid this, they can:
- Pay the deferred VAT in full by 30 June 2021
- Join the VAT deferral new payment scheme (online by 21 June 2021)
- Make alternative arrangements to pay HMRC by 30 June 2021
For more information and to join the scheme, visit the gov.uk website here.
Need extra help to pay?
There is help available should businesses need additional support in making payments. Queries should be submitted to HMRC by 30 June 2021. Further details can be found here.