VAT - You could defer bills until April - Coronavirus VAT

VAT – Rishi Sunak has been pulling all the levers he can at the Treasury to help tide employers over the steep but hopefully short-lived collapse in sales during the lockdown. The measures have been as wide-ranging as they have been generous, with a cost to the Treasury of some £300 billion and counting.

While the loans and job support schemes have hogged the headlines, there’s a third critical element that has received less attention — massive deferrals for businesses on paying their tax bills.

Business owners and the self-employed have been allowed to defer taxes due during the lockdown period to help with cash flow at a time many have seen their sales dwindle to nothing.

For the 55 per cent of small- and medium-sized firms who have taken part, it has been a lifesaver.

But here’s the rub. The deferral for most of these taxes runs out on June 30. If you’ve deferred, it’s almost time to cough up. That’s the bad news.

So here’s good: HMRC is willing to offer further deferrals to those who still can’t afford to pay — possibly right through until next April — under the Time to Pay scheme.

It may feel like you’ve only just gone through the rigmarole of applying for the last round, but if you think you’re going to struggle to pay, you must start talking turkey with the taxman now. If you do, it’s highly likely you could get a deferral until next April.

Call your HMRC customer compliance manager today if you have one, or use one of the helplines if not.

They won’t rule that everyone’s a deserving cause.

Brace yourself for them to ask about the financial outlook for your individual business plus the prospects for your industry more generally.

What taxes are they prepared to consider? VAT can automatically be deferred, so that’s simple. But import VAT, customs and excise and other duties aren’t.

Source – https://www.standard.co.uk/