The End of VAT Deferral
VAT Deferral Scheme
Many businesses will have taken advantage of the Governments VAT Deferral scheme which allowed a business to defer until 31/3/2021, without penalty, the VAT due to be paid on VAT returns with a due date ending between 20 March 2020 and 30 June 2020; essentially payments due for the quarterly VAT returns ending 28 February, 31 March and 30 April.
In taking advantage of the scheme a business was required to cancel their direct debit in good time so that payment for the VAT return was not taken by HMRC.
Businesses would then need to reinstate their direct debit early enough for any payment due outside of the deferral period to be taken by HMRC. If not, the payment may be late and the business could suffer a default surcharge.
The VAT that is due on the VAT return ending 31 May 2020 is payable on/by 7 July 2020 and is outside of the deferral period.
Have you/your client reinstated their direct debit?
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