If you took advantage of the Covid-19 VAT payment deferral scheme you have until 21 June to register with HMRC to repay the outstanding VAT by monthly instalments.
The deadline for payment in full or to opt into the monthly instalment plan was originally 31 March 2021 but has now been extended to 21 June 2021.
If you have deferred VAT payments due between 20 March and 30 June 2020 and still have amounts outstanding, you have the following options:
- pay the deferred VAT in full, on or before 31 March 2021
- join the VAT deferral new payment scheme – see below
- contact HMRC if neither of the above apply.
Failure to act may result in HMRC charging interest or a penalty.
What is the VAT deferral new payment scheme?
The new scheme will be open from 23 February 2021 and is accessible via your HMRC Business Tax Account. The first instalment has to be paid when you apply to use the scheme, with the subsequent payments being made via direct debit (if you’re unable to pay via direct debit alternative payment methods will be available).
Businesses must join the scheme themselves by 21 June 2021 information about how to do this can be found here https://www.gov.uk/guidance/deferral-of-vat-payments-due-to-coronavirus-covid-19
Unfortunately, agents cannot do this on behalf of clients as the HMRC software doesn’t allow for this.
To be eligible to use the scheme, businesses must have a balance outstanding to HMRC and all VAT returns must be submitted and up to date.
For larger businesses who are in the VAT payment-on-account regime, the scheme will be available to use towards the end of March.
Disclaimer
The information was correct at time of publishing but may now be out of date.
