Days left to join VAT Deferral New Payment Scheme
Businesses that joined the deferred VAT payments scheme last year, have until 21 June 2021 to join a new payment scheme that will allow them to spread the cost of deferred VAT.
The new online system will allow businesses to pay their VAT In monthly instalments under the .
Over half a million businesses deferred VAT payments at the height of the coronavirus pandemic last year. Between March and June 2020, businesses deferred a total of £34 billion under the VAT Payment Deferral Scheme.
Businesses had until 31 March 2021 to pay this deferred VAT. If they could not afford to do so, they had the opportunity to go online and set up a payment scheme to spread the cost.
March, April and May joining dates have now passed, but businesses can still join the scheme and spread payments across eight interest-free monthly instalments if they join by 21 June 2021. After 21 June 2021, the online scheme will close.
Jim Harra, HMRC’s Chief Executive, said: “Businesses that deferred paying their VAT last spring have until 21 June to join the VAT Deferral New Payment Scheme online. They should act now to avoid missing out on this opportunity to spread payment of their deferred VAT across monthly, interest-free, instalments.
“The new payment scheme is part of the government package of support worth over £350 billion to help protect millions of jobs and businesses during the pandemic and as we emerge on the path to recovery.
“HMRC will continue to do all we can to help businesses as they reopen and rebuild.”
HMRC data shows that 228,850 businesses that deferred their VAT have already paid their bill in full. Receipts from this, together with instalments already paid under the instalment scheme total £15.1 billion. Since the online service opened on 23 February 2021 another £11.5 billion has already been committed to future instalment payments by 134,627 businesses.
Businesses that don’t join the online scheme by 21 June or pay in full by 30 June, could face a 5% penalty on their outstanding VAT bill and/or interest on the bill.
You can register for monthly payments on the . For more information about VAT deferral and other types of government support, speak to a member of our team. Call: 0800 281 0303.