As part of the Government’s support during the COVID-19 pandemic, the Government deferred:
- The second payment of self-assessment tax on account, which is due on 31st July. HMRC has issued statements to those who were due to make this payment by 31st July, showing that the payment is now due by 31st January 2021.
- VAT payment due between April – June 2020. This payment must be made before 31st March 2021.
In both cases, HMRC’s guidance has stated that deferral is an option for those impacted by COVID-19.
Whilst these deferrals were very welcome in supporting the cashflow of a business and an individual during these challenging times, we would encourage clients to start making these payments, or at least part-payments, as soon as they can. The end of January is always a difficult time at the start of the year and after the festive period and this will be when any balancing payment for 2019/20 self-assessment will be due together with the first payment on account for 20/21 which will both have interest added if not paid in time. It is also the time any VAT deferrals will be due to be paid as well as the current VAT payments as they fall due. Therefore, paying some of the amounts now will help with cashflow at the end of the year.