All the businesses who had their VAT payments deferred till 30 June 2020 need to take action now.
To help the businesses manage their cash flows, HMRC had introduced many financial support schemes. As part of this scheme HMRC had allowed all UK VAT registered businesses to defer their VAT payments due between 20 March 2020 and 30 June 2020 until 30 March 2021.
The businesses who had cancelled their direct debit mandate with HMRC should reinstate it now in order to avoid any delays in the payments that are due in July 2020 and onwards.
Reinstating direct debit: Agents cannot reinstate the direct debit, the businesses will need to do that from their business tax account. Mandate should be reinstated 3 working days before the VAT return is filed its better to do it now to avoid any last minute confusions.
The VAT payments due after the deferral period will be paid as normal. The payments which were deferred can be made any time until 30 March 2020 and you do not have to pay them immediately.
If you expecting any refund from HMRC this will not be offset against the Vat deferred payments but will be adjusted against any debts owed to HMRC.
The businesses should be prepared to pay their VAT now. If any business is struggling to pay their tax bill they should contact covid-19 help line. HMRC provides many financial schemes if you are going through financial distress you can make use of one of these schemes for example business interruption loan. You even get in financial arrangements with HMRC. If you explain your financial position to them they may agree to collect the payments in instalments.
Will I be still be getting VAT relief if I am importing Medical Equipment
IF you are importing medical equipment from non EU countries, you will get relief on import VAT and import duty deferral. You can still apply for this deferral until 31 July 2020. The medical equipment will include protective clothing and medical devices.
Other businesses can also apply for the extension of the time in which they can pay the import duty and they won't have their goods held at the customs. They need to prove to HMRC that they are having financial difficulty. They can do so by emailing at the following address:custdebtrr.customspolicy@hmrc.gov.uk.
We hope that you were submitting the VAT returns in timely manner in order to avoid any penalties. If you have any issues making VAT payments, applying for reliefs available in Covid-19, please do not hesitate to contact us at 020 8127 0728