VAT deferment - direct debit reminder!
If you are VAT registered and took advantage of the VAT payment deferral arrangements you will need to reinstate your direct debit.
Any VAT registered businesses who took advantage of the VAT payment deferral arrangements, which HMRC announced as part of their COVID-19 support measures, will need to reinstate those direct debits so that payments due after 30 June and in relation to liabilities declared on their May and subsequent VAT returns can be made to HMRC.
HMRC suggest that direct debit mandates should be set up at least three working days before a VAT return is filed. Equally, in the event any outstanding VAT returns need to be filed then after filing, three working days should be left clear before reinstating the direct debit mandate for the May VAT return.
HMRC have confirmed to the ICAEW Tax Faculty that they will not collect the outstanding balance of deferred VAT returns when the direct debit mandate is reinstated. HMRC state that they have made the necessary systems change to avoid this happening for businesses who signed up to MTD for VAT.
If you have any questions, please get in touch.