However, as this period is coming to an end on 30 June businesses need to take action and:
- set-up cancelled direct debits in enough time for HMRC to take payment
- submit VAT returns as normal, and on time
- pay the VAT in full on payments due after 30 June
If your business took advantage of this deferral period you now need to take steps to reinstate your direct debit. They must be place in time for payments due in July onward. Direct debit mandates usually need to be set up at least three working days before you file.
HMRC has confirmed that it won’t collect the outstanding balance of deferred VAT when the direct debit mandate is reinstated. However, you will have the option to make additional payments with subsequent returns to ensure that the deferred amount is paid in full on or before 31st March 2021.
Time to pay
It’s worth noting that alongside reminding businesses of the end of the deferral period HMRC is publicising the time to pay arrangements.
Time to pay arrangements are available to all businesses and individuals who are in temporary financial distress as a result of coronavirus. Though time to pay arrangements that started before 20 March 2020 should still be paid.
If you’re struggling to pay your tax bill on time, or you’re experiencing financial difficulties it’s worth considering contacting HMRC’s Time to Pay service.
