VAT deferral payment scheme closes on 21 June 2021

Did you defer VAT payments due between 20 March and 30 June 2020 and still have payments to make? If so, there is still time to opt to pay the deferred VAT in 8 equal instalments, interest free.

Businesses which deferred VAT payments due between 20 March and 30 June 2020 and still have payments to make can:

  • Pay the deferred VAT in full, on or before 30 June 2021
  • Join the VAT deferral new payment scheme – the online service is open up to and including 21 June 2021
  • Contact HMRC on Telephone: 0800 024 1222 by 30 June 2021 if they need extra help to pay

Businesses may be charged a 5% penalty or interest if they do not pay the outstanding amounts in full or make arrangements to pay by 30 June 2021.

The VAT deferral new payment scheme

The VAT deferral new payment scheme is open from 23 February up to and including 21 June 2021.

The VAT deferral new payment scheme lets businesses:

  • Pay the deferred VAT in equal instalments, interest free
  • Businesses joining the scheme now will be able to make a maximum of 8 instalment payments

Conditions to join

To join this scheme online, businesses must:

  • Still have deferred VAT to pay;
  • Have a government gateway account;
  • Be up to date with all VAT returns from the last 4 years;
  • Join the scheme themselves by 21 June 2021 (An agent cannot do this on behalf of businesses);
  • Know how much is owed, including the amount originally deferred and how much may have already been paid
  • Pay the first instalment when joining; and
  • Be able to pay the deferred VAT by Direct Debit.

If businesses cannot use the online service, for example if they cannot pay by direct debit, it may still be possible to join the scheme using an alternative entry route by contacting the COVID-19 helpline on 0800 024 1222 when the scheme opens.

Error corrections

Businesses cannot include additional amounts owing resulting from error corrections, which relate to a period covered by the VAT deferral that is notified to HMRC after 31 March 2021.

Businesses which join the scheme can still have a time to pay arrangement for other HMRC debts and outstanding tax.

Further information can be found here.

Contact us

For further advice, including support around correcting errors, please contact:

Hydeam Sulton – hydeam.sulton@taitwalker.co.uk
Louise Phillipps – louise.phillipps@taitwalker.co.uk
Ryan Griffiths – ryan.griffiths@taitwalker.co.uk