Businesses that failed to service deferred VAT slapped with fines

Businesses that failed to repay or make an arrangement to service their deferred VAT payments are now being issued a 5 per cent penalty or interest.
According to the HMRC, over half a million businesses deferred VAT payments between 20 March and 30 June 2020, with the tax authority now confirming a penalty will be handed to those that did not comply with the 30 June 2021 deadline.

Earlier this week, the HMRC issued further details noting that businesses that failed to pay their deferred VAT in full, or to make an arrangement to pay by 30 June, must now pay a penalty – calculated on the amount of unpaid deferred VAT.

It clarified that making an arrangement to pay included either joining the VAT deferral new payment scheme or contacting HMRC to agree extra help to pay.

Applications for the VAT Deferral Payment Scheme wound up in 21 June, and allowed taxpayers to schedule payments monthly.

Those that missed out are now being slapped with a fine.

“You must pay the penalty within 30 days of the date of the penalty assessment,” the HMRC said, but confirmed that some businesses may be in a position to appeal.

Source: Financial Accountant click here to read more.