The key Government measure to support VAT registered organisations during the current coronavirus outbreak is the VAT payment deferral scheme, which allows VAT return payments due between 20 March and 30 June 2020 to be deferred until the end of March 2021. VAT returns must still be submitted on time and direct debits must be cancelled to take advantage of the deferral scheme.
There are a number of other coronavirus-related VAT and indirect tax measures that organisations should also be aware of.
- As the coronavirus lockdown may have delayed some shipments of goods, HMRC has temporarily waived the export time limits so that the VAT zero-rate can still be applied to goods that are sent outside the EU if the other export conditions are met.
- Until 30 June 2020, commercial property landlords have more time to notify HMRC of an option to tax (90 days instead of the usual 30 days).
- HMRC has advised that it will agree to a three-month extension to the usual 30 day deadline for appealing or requesting a reconsideration of an HMRC decision (including VAT assessments).
- Temporary VAT and duty reliefs have been announced on a variety of personal protective equipment (PPE).
- Import VAT and duty deferment account holders have been offered the opportunity to apply for extra time to settle amounts owed. HMRC will also consider requests for time to pay arrangements for other indirect tax liabilities, such as excise duties and aggregates levy.
- HMRC has decided to allow more time for VAT registered traders to meet the ‘digital links’ requirement of Making Tax Digital for VAT. Businesses now have until their first VAT return period starting on or after 1 April 2021 to put digital links in place.
- The introduction of an extension to the VAT domestic reverse charge to include some construction services has been delayed again, this time from 1 October 2020 to 1 March 2021.
For more information, please get in touch with Philip Munn.