Time to Pay arrangements offer VAT deferrals to businesses struggling with cash flow due to Coronavirus.
COVID-19 – Time to Pay Arrangements
The UK Government has already pledged to support businesses being affected as a result of Coronavirus, and there are lots of grants and support options available for a variety of different business set-ups. One measure available to help maintain liquidity within the business at this stage is delaying payment of VAT liabilities to HMRC.
If you want to delay your VAT payments and you usually pay this via direct debit, then you will need to contact the bank and instruct them to withhold the next direct debit to HMRC, and secondly cancel the direct debit completely (This can be done online).
If your accounting software has a tick box to pay by direct debit, you should also remove this too – This may need to be repeated each time a VAT payment is due if necessary.
It is essential to note that VAT Returns must be filed as soon as possible as otherwise, HMRC will not discuss the options available to you with this support.
When discussing with HMRC, you will need some key data on hand:
VAT Registration Number
Date of Registration
Address of which the registration is valid
The liability shown on your last filed return – This is the amount in box 5.
There will then be two key options available from the HMRC:
Defer VAT payments for 3 months – A payment plan will be arranged here if necessary.
Arrange payment plan to pay regular direct debits – This may be weekly, fortnightly or monthly.
We hope this advice will help clients to ensure their cash flow remains positive.
If you would like to discuss this further with the Brightshire team, please contact us.
It is essential to note that VAT Returns must be filed as soon as possible as otherwise, HMRC will not discuss the options available to you with this support. ”