Vat payment and filing obligation reminder

Sep 21, 2020

HMRC has sent the below message in respect of VAT which reminds taxpayers of the potential for VAT default.

“We understand the challenges businesses have faced recently as a result of the impact of the COVID-19 pandemic.

We have supported businesses through the Coronavirus Job Retention Scheme and the Self-Employment Income Support Scheme, alongside a wide range of measures including the VAT payments deferral scheme which was introduced on 20 March 2020. This allowed all VAT businesses to defer payments that would ordinarily be due between 20 March and 30 June to be paid by 31 March 2021. We prevented late payment penalties for all customers during the VAT deferral period, including MTD customers. Customers were required to file on time throughout the deferral period but penalties for late filing were also suspended.

As we gradually return to normal life, HMRC has begun to slowly reduce some of the measures that were put in place to support businesses through this difficult time. The VAT payments deferral scheme ended on 30 June and all VAT customers, including MTD customers, are required to file and pay on time.

We want to ensure customers understand the situation, and are clear that they will be at ‘default’ if they fail to meet their VAT obligations and may face a penalty as well as being charged interest on any tax that is due.

It is important now more than ever to ensure that you stay on track. More information on surcharges and penalties can be found at www.gov.uk/vat-returns/surcharges-and-penalties.

If a business needs more help to pay their VAT, they may be eligible to get support with their tax affairs through HMRC’s Time To Pay (TTP) service. More information can found at https://www.gov.uk/difficulties-paying-hmrc.

Further help and guidance on complying with MTD for VAT is available at www.gov.uk/government/collections/making-tax-digital-for-vat