If you opted to defer VAT payments due to HMRC between 20 March and 30 June 2020 and the deferred amounts have not been paid in full yet, you will need to take one of the following actions.
You may be charged interest or penalties if you do not use one of the 3 methods described below.
You can either:-
- Pay the amount in full to HMRC on or before 31 March 2021.
You do not need a special reference for this, you will just need to use your VAT registration number as the reference.
- Join the VAT deferral new payment scheme (the online service is open between 23 February and 21 June 2021). The scheme allows you to pay your deferred VAT in equal instalments, interest free. You can choose the number of instalments (from 2 to 11) depending on when you join the scheme.
- Contact HMRC by 30 June 2021 to agree extra help to pay your deferred VAT on the COVID-19 helpline detailed above.
To be eligible to use the VAT Deferral new payment scheme you must:-
- Join the scheme yourself using your Government Gateway Account, we cannot do this for you as your agent.
- Still have deferred VAT to pay.
- Be up to date with your VAT returns. If you do have outstanding VAT returns you can submit any late VAT returns to HMRC before you join the scheme to become eligible for the new scheme.
- Join by 21 June 2021.
- Pay the first instalment when you join.
- Pay your instalments by Direct Debit.
Make sure you know how much you originally deferred and how much you have already paid.
The month you join the scheme will determine the maximum number of instalments available to you. If you join the scheme in March, you will be able to spread your deferred VAT over 11 instalments or fewer.
The monthly joining deadlines and the corresponding number of maximum instalments (including the first payment) are detailed below:-
|If you join by:||Number of instalments available to you:|
|19 March 2021||11|
|21 April 2021||10|
|19 May 2021||9|
|21 June 2021||8|
If you are using the VAT Annual Accounting Scheme, you will be invited to join the new payment scheme later in March 2021.
If you join the scheme, you can still have Time to Pay arrangements for other outstanding HMRC taxes.
If you would like to join the scheme but you cannot use the online service to join, contact HMRC on the COVID-19 helpline on 0800 024 1222.
February 23rd, 2021