We have had received some questions on what to do about VAT.
As part of the Government help it was announced that VAT payments can be deferred until 31 March 2021; the question is what does that mean in practice.
Our current opinion is that VAT should be prepared and submitted to HMRC in the normal way. Once it is submitted you then look to defer the payment of the VAT.
We are suggesting that if you are unable to pay the VAT and have a direct debit that you cancel the direct debit before the due date. Do not rely on HMRC not collecting the money if it will create a cash-flow issue for you.
We advise you to contact HMRC to tell them you will not be paying but will submit returns each quarter as normal.
So:
- Prepare and submit returns on time.
- Let HMRC know the payment status.
- Understand that this is a deferral and not a cancellation of the debt.
If you have any questions please contact us and stay staff.
