Following the Government’s announcement that businesses will be able to defer VAT payments for the period from April – June, HM Revenue & Customs (HMRC) has now confirmed that businesses should cancel direct debits for VAT if they want to utilise the deferment offer.
The deferral of VAT payments will be for a period of three months, while income tax payments have been deferred from July 2020 to January 2021.
The VAT deferral will apply from 20 March 2020 until 30 June 2020, and all UK businesses are eligible.
This offer is automatic, with no applications necessary, and no VAT payment will be required during the period.
However, businesses that ordinarily pay by direct debit are being urged to cancel their direct debit with their bank to avoid HMRC attempting to automatically collect when receiving your VAT return.
For more information on the VAT deferral scheme, go to https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses
For help and advice, contact our expert team today.