Paying VAT – Reinstating your VAT direct debit

June 19th, 2020     Covid-19 Business Support

The deferral of VAT payments due to coronavirus comes to an end on 30 June and if you cancelled your direct debit and you want to continue to pay by direct debit in the future you will need to take action to reinstate the direct debit mandates.

HMRC will issue guidance on the end of the VAT deferral period very soon but, to be effective, direct debit mandates usually need to be set up three working days before a VAT return is filed.

How to reinstate your VAT direct debit

We cannot set up direct debit mandates on behalf of businesses ; you will need to set up the mandate through your HMRC business tax account. You can access your business tax account here, you will need your Government Gateway User ID and password: https://www.gov.uk/log-in-register-hmrc-online-services

If you encounter problems with reinstating your direct debit please get in touch with us.

Other ways to pay your VAT

There are other ways to pay your VAT and these can be found here: https://www.gov.uk/pay-vat
When using other ways to pay your VAT, you should remember that you will need to actively remember that you must pay the VAT and that you must pay on time to avoid penalties.

What if you can’t pay your VAT

If you are unable to pay your VAT , you should contact your VAT adviser and HMRC before it becomes due as it may be possible to set up a time to pay arrangement.

Anticipate a refund of VAT?

If you anticipate a refund of VAT and you have not had one for a long time, to minimise delays, it is worth checking that your refund bank account details are up to date with HMRC. Note that setting up a direct debit will not automatically update this record. You can access your business tax account here, you will need your Government Gateway User ID and password: https://www.gov.uk/log-in-register-hmrc-online-services

VAT that has been deferred until 31 March 2021

HMRC has confirmed that it will not collect the outstanding balance of deferred VAT when the direct debit mandate is reinstated. HMRC has made the necessary systems change to avoid this happening for businesses in MTD for VAT

If you need help with any of the above, please call Verity Newton on 01803 296678.

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