Due to Covid19, HMRC allowed businesses to defer VAT that was due between 20 March and 30 June 2020. They have now announced details of how you can pay now or join the new VAT Deferral Scheme. Read on to see the options available. 
You may be charged interest or a penalty if you do not take action! 

The Options 

If you deferred VAT payments due between 20 March and 30 June 2020 (due to Covid19) and still have payments to make, you can: 
 
pay the deferred VAT in full, on or before 31 March 2021 
join the VAT Deferral new payment scheme – the online service is open between 23 February and 21 June 2021 
contact HMRC on 0800 024 1222 by 30 June 2021 if you need extra help to pay 
 

Option 1: Pay the VAT before 31 March 2021 

If you simply want to go ahead and pay the deferred VAT, you do not need to contact HMRC, you can just go ahead and make the payment. 
 
As a reminder, the easiest way to pay is by bank transfer. The bank details for making payment are:- 
 
Account Name: HMRC VAT 
Sort Code: 08 32 00  
Account Number: 11963155 
 
And remember to use your VAT Number as the payment reference. 
 
Or, you can visit the HMRC page: Pay your VAT bill

Option 2: Join the VAT Deferral New Payment Scheme 

The VAT deferral new payment scheme will be open from 23 February up to and including 21 June 2021. 
 
The new scheme lets you: 
pay your deferred VAT in equal instalments, interest free 
choose the number of instalments, from 2 to 11 (depending on when you join) 
 
To use the online service, you must: 
join the scheme yourself, your agent cannot do this for you (<<< This is a pain! But we will be happy to assist any of our clients with this) 
still have deferred VAT to pay 
be up to date with your VAT returns 
join by 21 June 2021 
pay the first instalment when you join 
pay your instalments by Direct Debit (if want to use the scheme but cannot pay by Direct Debit, there’s an alternative entry route for you) 

Option 3: Struggling and need more help? Contact HMRC 

If your business is struggling and you can't see a way to make the VAT payment, even with the Deferral New Payment Scheme, you MUST contact HMRC on 0800 024 1222. 
 
This is a dedicated phone line for businesses strugglign due to Covid-19. 
 
See the guidance here

Want to know more? Want help? 

If you want to know more about your options, you can read HMRC's guidance here. If you want to discuss your options or want help applying for the VAT Deferral New Payment Scheme, please book a call with Nicola here
 
 
 
 
Written by: 
 
Nicola J Sorrell -  
Effective Accounting 
 
Founder | Xero Champion | IR35 Expert 
 
 
Tagged as: Coronavirus, VAT
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