VAT Deferral – Cancel your VAT direct debit!
The Chancellor has announced that VAT payments can be deferred for the next 3 months. All VAT-registered UK businesses are eligible for the deferral.
If your business normally pays VAT by direct debit, you will need to cancel your direct debit in order to benefit from the VAT deferral. The Treasury has confirmed that it can not cancel direct debits unilaterally, so unless you cancel it, the money will be deducted automatically following the submission of your VAT return. Please do this well in advance of your normal VAT payment date so HMRC do not attempt to collect the payment.
Businesses will not need to make a VAT payment during the deferral period of 20 March 2020 to 30 June 2020. This will generally mean the deferral of the VAT quarter due for payment on 7 April, 7 May or 7 June 2020, or the monthly payments due on each of these dates. Any outstanding VAT payments accumulated during the deferral period will need to be paid to HMRC by the end of the 2020/21 tax year.
It is important that you remember to set up the direct debit again in due course.
Businesses should continue to file their VAT returns as normal by the due dates. The Government will pay VAT refunds and reclaims as usual during this period.
If you have any questions about your VAT, please contact us.
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