The guidance can be found here. Please review this guidance and information below as there is a requirement to either:
- Pay the deferred VAT in full by 31 March 2021; or
- Opt into the new payment scheme by 21 June 2021; or
- Agree extra help to pay with HMRC by 30 June 2021
HMRC may issue interest charges or penalties if one of the three options stated above is not completed.
The new online opt-in scheme will be open from 23 February 2021 to 21 June 2021 and allow you:
- To pay your deferred VAT in equal instalments, interest free; and
- Choose the number of instalments from 2 to 11 depending upon when you join the scheme (if you join by 19 March 2021, you can choose the maximum number of instalments, which decreases the later you join the scheme).
Note: If you delay in joining the scheme, you will have fewer number of instalments, paying higher amounts. This will increase cash outflows for those businesses that delay in opting in.
| If you join by: | Number of instalments available to you: |
|---|---|
| 19 March 2021 | 11 |
| 21 April 2021 | 10 |
| 19 May 2021 | 9 |
| 21 June 2021 | 9 |
Before joining the scheme, HMRC specify that taxpayers must create/ensure it has its own Government Gateway account as well as ensuring any outstanding VAT returns from the past four years have been submitted.
HMRC have confirmed that if you join the scheme, you can still have a Time to Pay (TTP) arrangement for other HMRC-related outstanding tax.
There may be circumstances where you cannot use the online service, for example if you:
- Do not have a UK bank account;
- Cannot pay by Direct Debit
- Have dual signatories on your account
If you want to join the new payment scheme, but cannot use the online service, contact the Covid-19 helpline when the scheme opens on Telephone: 0800 024 1222. An adviser will help you join.
HMRC portal is expected to be very busy in the final days of the deferral scheme. Therefore, it is recommended that businesses consider their participation in advance of the 21 June 2021 deadline.
