VAT & Income Tax
Deferral of VAT payments
The Government is giving businesses the option to defer VAT payments due between 20 March to 30 June 2020 without interest or penalties being owed. However, you will still need to submit your VAT return to HMRC on time. You can continue making payments as normal if you are able.
If you do choose to defer your VAT payment due to COVID-19 you must still pay the VAT due on or before 31 March 2021. Remember to cancel your direct debit payment with your bank if you are deferring your payment and normally pay in this way. Please note that VAT payments owed after the end of the deferral period will have to be paid as normal and more information will be available to tell you how to repay the VAT payments that you have deferred if you have chosen this option.
Domestic Reverse Charge for Construction Services – this has been delayed from 1 October 2020 until 1 March 2021 due to the impact of the coronavirus on the construction sector. Find out more here
Income Tax Payments
You can also defer your second payment on account on your Self-Assessment income tax bill which is normally due on 31 July. If you do choose to delay payment, you will have until 31 January 2021 to pay it. If you owe less than £10,000, you may be able to arrange to pay in instalments online. Call the Self-Assessment Payment Helpline for more information on 0300 200 3822 (Available 8am – 4pm Mon – Fri).
For more information on VAT & Income Tax support click here or you can call the HMRC COVID-19 Tax Helpline if you have any specific questions about your ability to pay your tax on 0800 024 1222 (Available 8am – 4pm Mon – Fri).
Check what expenses are taxable if your employee works from home due to COVID-19 here
Time to Pay Service
If you are a business or self-employed, be that a sole trader or freelance worker and you are in financial distress as a result of COVID-19 with outstanding tax liabilities. Assessed on a case by case basis, you may be eligible to receive support.
For more information click here or call the HMRC’s COVID-19 Helpline on 0800 015 9559
Business Rates Support
Business Rate Relief for Retail, Hospitality and Leisure sector
Business in these sectors will not have to pay business rates for the 2020 to 2021 tax year. The rate relief will automatically be applied by your local authority.
You qualify if your business property is a:
- Restaurant, café, bar or pub
- Cinema or live music venue
- Sports club, gym or spa
- Hotel, guest house or self-catering property
You will also be able to receive business rate relief if your business is a nursery on Ofsted’s Early Years Register or provides care and education for children up to five years old.
Support for Business that pay little or no tax
If your business receives small business rate relief, rural rate relief or tapered relief, you may be eligible for a one-off grant of £10,000 to help meet ongoing business costs – click here for more information