Alongside the deferral of income tax in July 2020, the VAT payments due in period 20 March to 30 June 2020 were also automatically deferred. This deferral represented the payment due for one VAT quarter.
Businesses were originally due to make up the deferred payments by the end of March 2021 in full.
All the businesses who took advantage of that deferral will now be able to spread that deferred VAT payment over 11 equal instalments payable between April 2021 and March 2022.
All businesses which took advantage of the VAT deferral can use the “New Payment Scheme”. Businesses will need to opt in, but all are eligible. HMRC will put in place an opt-in process in early 2021.
This measure is part of the Winter Economy Plan announced by the Chancellor on 24 September 2020.
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