VAT payments deferral to support businesses affected by the coronavirus
On Friday 20 March, the government announced that there will be an automatic VAT payment deferral for 3 months to help businesses with their cashflow during the coronavirus outbreak. The deferral will apply to all UK businesses for VAT payments due between 20 March 2020 to 30 June 2020.
No applications are required for the deferrals and businesses will not need to make a VAT payment during this period. Any VAT return payments that are deferred will need to be paid by 31 March 2021.
Taxpayers will be given until the end of the 2020/2021 tax year to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal. No penalties or interest for late payment will be charged in the deferral period.
Businesses must cancel their Direct Debits for this period, otherwise HMRC will continue to take the payment.