Smarter accounting

More time to pay VAT

25 September 2020, Advocates, Barristers, Companies, Creative Industries, General, Sole Traders

Rishi Sunak has given you more time to pay VAT

On 24th September 2020 the UK Chancellor announced that businesses who deferred VAT due from 20 March to 30 June 2020 will now have more time to pay VAT from this period.  The original deadline for this VAT was 31st March 2021.

Instead of paying the full amount by the end of March 2021, you can make smaller payments up to the end of March 2022, interest free.  You will need to opt-in to the scheme, and for those who do, this means that your VAT liabilities due between 20 March and 30 June 2020 do not need to be paid in full until the end of March 2022.

You may receive a letter from HMRC saying that your deferred VAT needs to be paid by March 2021, but the letter was printed just a day before the announcement from Rishi Sunak.  You can still pay your deferred VAT by 31st March 2021, but there will also be a scheme to spread any outstanding balance over the following 12 months.

Out of date letter from HMRC for Deferred VAT payments

How do I check the amount of VAT due to HMRC?

Log in to your HMRC online account (Gateway account) and select View your VAT account.

More time to pay VAT - View VAT account

If you deferred payment of your VAT due between 20th March and 30th June you should see an overdue notification and can click on the Check what you owe link to view the balance due.

More time to pay VAT - What you owe

Can I pay my VAT before March 2021?

If you want to start paying your VAT before 31st March 2021, the easiest way to do this is by bank transfer. Additional payments made before March 2021 will be applied to your overdue balance.


HMRC VAT Payment details

Sort Code08 32 00
Account Number11963155
Account NameHMRC VAT
Payment ReferenceYour VAT Number (e.g. 123456789)

How do I defer VAT payment to March 2022?

Check the website for details on opting in to the scheme for more time to pay VAT.

You cannot opt in yet.  The online opt in process will be available in early 2021.

The VAT Deferral New Payment Scheme will require a Direct Debit to be set up as part of the digital opt-in process.  This must be done by the authorised bank account holder.  For this reason, you must opt in yourself, your agent cannot do this for you.


How do I set up my Direct Debit?

See here for the article on setting up a Direct Debit for VAT.

Deferred VAT Payment to March 2022 - more time to pay VAT

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