Deeks VAT News
Keeping you up to date on VAT changes – April 2020
During this extremely worrying time due to the Covid-19/Coronavirus within the UK, we want to provide you with an update on the latest measures taking by the UK Government in regard to VAT. These measures will give some assistance to businesses during this crisis.
Deferral of VAT payments due to coronavirus
On the 20 March HMRC announced the deferral of UK VAT payments. The detail of the measures announced are as follows:
- Deferral applies to any UK VAT registered business; this corrects the initial announcement that it applied to any UK business and clarifies that it applies to non-UK established businesses that are registered for UK VAT
- It applies to any VAT payment due between 20 March 2020 and 30 June 2020
- Deferral is optional – VAT can still be paid
- The arrangement does not apply to VAT MOSS payments
- HMRC will not charge interest or penalties on any amount deferred under these arrangements
- VAT Returns still need to be submitted by the due date
- VAT Reclaims and refunds will be processed as normal during the deferral period
- Any deferred VAT needs to be paid by 31 March 2021
- Direct Debits should be cancelled as soon as possible to avoid the payment being taken – it is the responsibility of the taxpayer to cancel the direct debit
- Following the deferral period, VAT payments will need to be made as normal – subject to a Time To Pay arrangement being agreed
HMRC have confirmed that the deferral also applies to Payments On Account (POA). A POA due between 20 March 2020 and 30 June 2020 can be deferred and must be paid on or before 31 March 2021.
Pay no import duty and VAT on medical supplies, equipment and protective garments (COVID–19)
On 31 March 2020, the UK Government announced that subject to certain conditions, and with immediate effect, import VAT and duty would not be payable on protective equipment, relevant medical devices or certain equipment brought into the UK from non-EU countries during that coronavirus (Covid-19) outbreak.
HMRC published guidance on how to https://www.gov.uk/guidance/pay-no-import-duty-and-vat-on-medical-supplies-equipment-and-protective-garments-covid-19. This gives information on what and who is covered by the relief, and how to claim it. The relief only applies until 31 July 2020.
Making Tax Digital for VAT – Postponed
On 1 April 2020, the digital links for Making Tax Digital for VAT was supposed to become a requirement. However, HMRC appears to have decided to delay this for a year, but has yet to make a public announcement.
Should you require any VAT assistance during this time, please do not hesitate to contact me.
Stay safe and keep well.
Please note that Deeks VAT News is not intended to be a comprehensive guide to every development in VAT. It should not be used as a substitute for specific advice in individual circumstances. Deeks VAT Consultancy Limited cannot accept any liability for any action/inaction as a result of any reliance on Deeks VAT News’s contents.
Deeks VAT Consultancy Limited
Managing Director: Jane Deeks LLB (Hons) LPC CTA