Give us your details and we’ll be in touch asap

Insights

All Articles

Business Services

Business Tax

Personal tax

Probate and Inheritance Tax

VAT

Business Tax  •  Coronavirus Advice  •  VAT

VAT payment holiday window ends on 30 June 2020

By RJP LLP on 26 June, 2020

The VAT payment holiday which was announced in Rishi Sunak’s speech on 20 March 2020 will be ending on 30 June 2020. Normal service for VAT resumes from 1 July 2020 and therefore any businesses who are filing a May 2020 VAT return will need to either pay the VAT due by 7 July 2020 or put in place a time to pay arrangement.

HMRC has said it will be sympathetic towards businesses that cannot pay by 7 July due to Covid-19. If you need to negotiate a Time to Pay arrangement, here is some advice on how to go about it.

Contacting the Payment Support Service (PSS)

It is important to make contact with the PSS at HMRC before the VAT return is due to be filed. Doing this means that any time to pay agreements agreed will not be subject to a default surcharge.

When you call the PSS make sure you have your business’ VAT number and bank account details to hand. You will need to be clear about the amount of VAT that is outstanding and your proposals to settle the arrears.

The HMRC officer will require details about why you cannot pay on time. We advise to and try and pay some of the VAT due as a partial payment on or before 7 July 2020 to get a better outcome.

When speaking to HMRC it is tempting to simply ask what the maximum time to pay arrangement could be. There is no fixed “going rate” period that HMRC allows.  It is far better to establish what you can pay by when and present this proposal to them with a justification.

Coronavirus disruption affecting cashflow or expenditure incurred to prepare for social distancing measures are likely to be some of the reasons why businesses are unable to pay their VAT.

Ensure that you reactivate the direct debit mandate if you delayed the previous quarter’s VAT return. Also note that cashflow projections should include the 31 March 2021 deadline for settling the VAT deferred during the payment holiday window.

To get in touch with the PSS, call 0300-200-3835. Lines are open 8am to 4pm, Monday to Friday.

If you would like help with your VAT return or further advice on PSS contact partners@rjp.co.uk 

Read more articles like this

Summer Budget 2020 Update

Domestic reverse charge VAT rules are delayed until 2021

The Updated Furlough Scheme – claims for June and July 2020

How can Covid-19 present an opportunity for employee share schemes?

Reminder: Is an In-Year ATED Return due on your company’s residential property?

Share this:

All Articles

Business Services

Business Tax

Personal tax

Probate and Inheritance Tax

VAT

Image

31 July 2020 - Normally an important deadline!

All taxpayers due to make self-assessment tax payments on 31 July 2020 can now delay their payment due to the disruption caused by Coronavirus. This includes self-employed taxpayers and also company directors who pay self-assessment tax on dividend income.

Read more in our coverage of Coronavirus and business support from the Government.