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Deferring VAT & Income Tax Payments

Deferring VAT & Income Tax Payments

The Government will support businesses by deferring Valued Added Tax (VAT) payments for 3 months. If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021.

 

VAT

For VAT, the deferral will apply from 20 March 2020 until 30 June 2020. This is VAT periods ending February, March and April. VAT returns will still need submitting by the normal deadline.

All UK businesses are eligible.

How to access the scheme

This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period. Please note HMRC have not cancelled DD’s. If you wish to defer please cancel your DD. Taxpayers will be given until the end of the 2020 to 2021 tax year to pay any liabilities that have accumulated during the deferral period with no interest running. VAT refunds and reclaims will be paid by the government as normal.

 

INCOME TAX

For Income Tax Self-Assessment, payments due on the 31 July 2020 will be deferred until the 31 January 2021.

If you are self-employed you are eligible. This is an automatic offer with no applications required.

No penalties or interest for late payment will be charged in the deferral period.

HMRC have also scaled up their Time to Pay offer to all firms and individuals who are in temporary financial distress as a result of Covid-19 and have outstanding tax liabilities.

 

Should you need any further assistance on deferring payments, please do not hesitate to contact our partners:

Kate Brown | Sarah Bainbridge | Andrew Robinson

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