If you deferred your VAT due to Covid-19, you need to start planning!
Last year, to help businesses who were suffering with cashflow difficulties due to Covid-19, the Government announced that they would defer VAT payments for 12 months.
Now, nearly 12 months later, businesses who did defer their VAT payments need to start planning, as these payments will be due by 31st March 2021. However, businesses don’t need to worry about being hit with one massive VAT bill. They are able to spread the payments over the year by paying it in 11 interest free instalments. The earlier you join, the more months you can spread your payments across.
If you want to pay by instalments, you need to meet the following criteria:
- Have deferred VAT to pay
- Be up to date with VAT returns
- Opt-in before 1 March 2021 (this is not currently open, but will be soon!)
- Pay the first instalment before the end of March 2021
- Be able to pay the deferred VAT by direct debit
Additionally, an online service will open on 23 February 2021 and close on 21 June 2021. When it opens, you can join the scheme online quickly and simply on this link.
For further information about planning your VAT payments, speak to your local AIMS accountant.