The deferment of VAT payments due to coronavirus comes to an end on 30 June and businesses need to take action to reinstate their direct debit mandates. UK VAT-registered businesses can defer VAT payments due between 20 March and 30 June 2020 until 31 March 2021. This covers quarterly and monthly VAT return payments for the periods ending February, March and April 2020. If you have previously deferred payments you now need to take steps to reinstate your direct debit. This is so that they are in place in time for payments due in July onward. Direct debit mandates usually need to be set up at least three working days before you file.

HMRC confirmed that it will not collect the outstanding balance of deferred VAT when the direct debit mandate is reinstated. However, you will have the option to make additional payments with subsequent returns to ensure that the deferred amount is payed in full on or before 31st March 2021.

Time to pay arrangements

Time to pay arrangements are available to all businesses and individuals in financial distress as a result of coronavirus. However, any arrangements that started before 20 March 2020 should still be paid.

If you’re struggling to pay your tax bill on time, or you’re experiencing financial difficulties you can contact HMRC’s Time to Pay service.

If you have any questions or need more information please don’t hesitate to contact us.