Tax Deferrals Explained

 

This week the government put in place a package of measures to help UK businesses during the Coronavirus outbreak.  Among them, were a Job Retention Scheme, Statutory Sick Pay Relief for SME’s, a Time to Pay Scheme, Grants and Business Rates Relief. For a summary of current help, please see our Support and Options article here.

Included in these measures from the Chancellor, is the deferral of VAT and Income Tax payments.

 

Deferring VAT Payments

Businesses will not now need to make a VAT payment for the 3 months between 20 March 2020 to 30 June 2020. It’s an automatic initiative with no applications required by business owners. Tas payers will be given until the end of 2020/2021 tax year to pay any liabilities that have accumulated during the deferral period.  And VAT refunds and reclaims will be paid by the government as normal.

Please just remember to cancel your direct debit, if you have one set up, and do so before HMRC attempts to take payment on receipt of your tax return.

 

Deferring Income Tax Payments

For self-employed workers, income tax payments that would have been due in July 2020 under the Self-Assessment system, will now be deferred to January 2021.  Again, this is an automatic offer with no applications necessary. There will be no penalties or interest for late payment charged during the deferral period.

 

As always, if you have any questions or concerns please get in touch with us via our CHAT button on our website, call or email.