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VAT Deferment and Time to Pay

Support for businesses through deferring VAT

The Government have announced support for businesses by offering the deferral of Valued Added Tax (VAT) payments for 3 months, this will apply for payments due between 20 March 2020 and 30 June 2020. HMRC will not charge interest or penalties on any amount deferred.

Am I eligible?

The deferral is available for all UK VAT registered businesses.

You can only defer:

  • quarterly and monthly VAT returns’ payments for the periods ending in February, March and April
  • payments on account due between 20 March 2020 and 30 June 2020
  • annual accounting advance payments due between 20 March 2020 and 30 June 2020

The deferral does not cover payments for VAT MOSS or import VAT

How to access the scheme

This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period and will be given until 31 March 2021 to pay any liabilities that have accumulated during the deferral period.

VAT refunds and reclaims will be paid by the government as normal.

Businesses that normally pay by direct debit should cancel the direct debit with their bank if they are unable to pay due to Coronavirus. Please do so in enough time so that HMRC do not attempt to automatically collect on receipt of your VAT return submission.

VAT Returns will still need to be submitted on time to HMRC, even if payments are being deferred.


Time to Pay Arrangements

If your business is struggling to pay other tax liabilities due to the impact of Coronavirus, you might be able to set up a Time to Pay Arrangement with HMRC. This might include payment deferrals or a tailored instalment plan.

These are negotiated on a case by case basis and aren’t always guaranteed.

For further information please contact our sister company Price Pearson who will be happy to discuss your individual requirements.




Last Updated: 17 Jun 2020 4:48 PM