VAT payments & how it works...
On 20 March, it was announced that the next quarter of all VAT payments were being deferred, with no VAT payable until the end of June, and those payments can be deferred until the end of the financial year.
All VAT registered businesses are eligible and the deferral will apply between 20 March 2020 and 30 June 2020. Businesses will not be required to pay VAT liabilities to HMRC during this period and any VAT liabilities that should have been paid during this period will need to be paid to HMRC by April 2021.
HMRC have advised that all businesses who normally pay their VAT by direct debit should cancel the direct debit with their bank if they would like to take advantage of the VAT deferral. Businesses should do so in sufficient time so that HMRC does not attempt to automatically collect the VAT on receipt of the VAT return. VAT refunds and reclaims will be processed as normal.
Self-Assessment and Self-Employed.
Any current Self-Assessment payments due for payment on 31 July 2020 are now deferred until 31 January 2021.
HMRC have advised that all taxpayers who normally pay their self-assessment by direct debit should cancel the direct debit with their bank if they would like to take advantage of the deferral. Taxpayers should do so in sufficient time so that HMRC does not attempt to automatically collect the tax in July. No penalties or interest will be charged during the deferral period.
The minimum income floor for the self-employed has been suspended: self-employed people can now access, in full, Universal Credit at a rate equivalent to Statutory Sick Pay for employees.
What is Time to Pay?
Time to Pay provides businesses who are affected by the impacts of COVID-19 with time to pay any outstanding or upcoming tax liabilities.
HMRC’s Time To Pay arrangements will be agreed on a case-by-case basis and are tailored to individual circumstances and liabilities. HMRC will assess the information provided and make a decision on whether the business is eligible for deferment/further deferment of payment.
How can we help?
We appreciate that many people do not like talking to HMRC on any level and may feel nervous about that. By working with HMRC on your behalf, we can take that strain away for you, ensuring the best possible chance of securing the best outcome for your business.
Find out more about HMRC payments and Time to Pay.
We’re here to help, so if you have any questions regarding any outstanding tax liabilities with HMRC or Time to Pay, get in touch.