UKCA marking – Find out if you need to use the UKCA marking and how to use it

The UKCA (UK Conformity Assessed) marking is a new UK product marking that is used for goods being placed on the market in Great Britain (England, Wales and Scotland). It covers most goods which previously required the CE marking, known as ‘new approach’ goods.

The UKCA marking came into effect on 1 January 2021. However, to allow businesses time to adjust to the new requirements, you will still be able to use the CE marking until 1 January 2022 in most cases.

The UK Government has produced guidance which explains how to use the UKCA marking. For further information on placing these goods on the market, see the guidance on placing manufactured goods on the market in Great Britain: https://www.gov.uk/guidance/placing-manufactured-goods-on-the-market-in-great-britain

The UKCA marking alone cannot be used for goods placed on the Northern Ireland market. See the guidance on placing goods on the Northern Ireland market: https://www.gov.uk/guidance/placing-manufactured-goods-on-the-market-in-northern-ireland

The UKCA marking is not recognised on the EU market. Products need a CE marking for sale in the EU. Find out how to use the CE marking: https://www.gov.uk/guidance/placing-manufactured-goods-on-the-market-in-northern-ireland

For further information see: Using the UKCA marking - https://www.gov.uk/guidance/using-the-ukca-marking

VAT deferred due to coronavirus

Information about paying deferred VAT in full or making an arrangement to pay by 30 June 2021 has been added to the webpage below. If you have not arranged a time to pay plan or have not repaid any VAT deferred then you should contact coronavirus (COVID-19) helpline to discuss your situation.

You may be charged a 5% penalty or interest if you do not pay in full or make an arrangement to pay by 30 June 2021.

See: Pay VAT deferred due to coronavirus (COVID-19) - https://www.gov.uk/guidance/deferral-of-vat-payments-due-to-coronavirus-covid-19

HMRC warn employers not to use Unfunded Pension Arrangements

HMRC are currently attacking a marketed tax avoidance scheme using unfunded pension arrangements to avoid Corporation Tax, Income Tax and National Insurance contributions.

HMRC strongly believes these arrangements do not work and will seek to challenge anyone promoting or using these arrangements and make sure the correct tax is paid.

The arrangements involve a company creating an unfunded pension obligation to pay one or more of their directors a pension. This is to create an expense in the company accounts to reduce the company’s profit. The intended result of this step is to reduce the amount of Corporation Tax payable.

With many of these arrangements, the company then transfers the pension obligation to a closely associated third party. The third party is usually a relative or colleague of the director due to receive the pension. The intended result of this step is a payment to the director or a closely associated third party, with no immediate liability to Income Tax and National Insurance contributions.

Users of these arrangements may pay considerable fees to use them, yet may still have to repay the tax claimed to be avoided, as well as interest and a penalty.

See: Disguised remuneration: tax avoidance using unfunded pension arrangements (Spotlight 58) - https://www.gov.uk/guidance/disguised-remuneration-tax-avoidance-using-unfunded-pension-arrangements-spotlight-58

25th June 2021 – Hillmans Weekly Update

Below I have summarised all the main tax related updates we have seen this week.

• Check if you're eligible for the coronavirus Additional Restrictions Grant
• Kickstart Scheme grant
• Pension Contributions are tax efficient for employee and employer
• Reminder - P11D Forms due by 6 July

If you have any queries about this week’s content, or if you need any assistance please do not hesitate to contact me.

I hope you have a great weekend.

Stay safe and well.

Cheers,

Steve

Steven Hillman BSc (Hons) ACA
Chartered Accountant
Tel: 01934 444100

Kickstart Scheme grant

If you are an employer looking to create jobs for young people, you can apply for funding as part of the Kickstart Scheme.

The Kickstart Scheme provides funding to create new jobs for 16 to 24-year-olds on Universal Credit who are at risk of long-term unemployment. Employers of all sizes can apply for funding which covers:

• 100% of the National Minimum Wage (or the National Living Wage depending on the age of the participant) for 25 hours per week for a total of 6 months

• associated employer National Insurance contributions

• minimum automatic enrolment pension contributions

Employers can spread the job start dates up until 31 December 2021. You will get funding until 30 June 2022 if a young person starts their job on 31 December 2021.

Further funding is available to provide support so that young people on the scheme can get a job in the future.

There is now a link to a video walkthrough of the online application in the ‘How to apply – Apply online’ section.

See: Apply for a Kickstart Scheme grant - https://www.gov.uk/guidance/apply-for-a-kickstart-scheme-grant

Pension Contributions are tax efficient for employee and employer

Pension contributions to approved pension funds on behalf of employees and directors continue to be a tax-free benefit provided the annual input limit is not breached. The contributions are also deductible for the employer provided incurred wholly and exclusively for the purposes of the trade and paid before the end of the accounting period of the business.

For most taxpayers, the annual input limit is £40,000 and this limit includes contributions by the employee and contributions made by the employer on their behalf. It is also possible to take advantage of unused relief from the previous three fiscal years.

Payments into the pension by the employing business will be deductible against business profits. Currently this will only save 19% Corporation Tax, but from 1 April 2023 will save 25% where profits exceed £250,000 and 26.5% where profits are between £50,000 and £250,000. Note that these limits are divided by the number of associated companies, i.e. under common control.

There are provisions for exceptionally large contributions where the deduction is spread over 2, 3 or 4 years.

Although the contribution on behalf of the employee or director may be tax free, they are generally not able to access the fund until age 55. There have been several “schemes” devised over the years to exploit the pension rules. It is therefore important to speak to a qualified Financial Advisor for your own pension advice. 

Check if you're eligible for the coronavirus Additional Restrictions Grant

The Additional Restrictions Grant (ARG) supports businesses that are not covered by other grant schemes or where additional funding is needed.

Local councils have the freedom to determine the eligibility criteria for these grants. However, the government expect the funding to help businesses that are severely impacted by the restrictions.

Local councils are encouraged to support:

• businesses from all sectors that may have been severely impacted by restrictions but are not eligible for the Restart Grant scheme, including those which do not pay business rates

• businesses from sectors that remain closed or severely impacted by the extended restrictions, even if those businesses have already been in receipt of Restart Grants. This may include the travel and tourism sector, wedding industries, nightclubs, theatres, events industries, wholesalers, English language schools, breweries, freelance and mobile businesses including caterers, events, hair, beauty and wedding related businesses

See: Check if you're eligible for the coronavirus Additional Restrictions Grant - https://www.gov.uk/guidance/check-if-youre-eligible-for-the-coronavirus-additional-restrictions-grant

Reminder - P11D Forms due by 6 July

Despite the coronavirus lockdowns, HMRC still expect P11D forms reporting expenses and benefits to be submitted by the normal 6 July deadline. Employers need to submit a P11D form to HMRC for each employee you’ve provided with expenses or benefits.

Employers also need to submit a P11D(b) form if:

• You have submitted any P11D forms
• You have paid employees’ expenses or benefits through your payroll
• HMRC have asked you to - either by sending you a form or an email

Form P11D(b) tells HMRC how much Class 1A National Insurance (at 13.8%) you need to pay on all the expenses and benefits you’ve provided. The National Insurance on benefits is due by 19 July.

If HMRC have asked you to submit a P11D(b), you can tell them you do not owe Class 1A National Insurance by completing a declaration.

Remember that reimbursed expenses no longer need to be reported where they are incurred wholly, exclusively and necessarily in the performance of the employee's duties. Dispensations from reporting are no longer required, although HMRC would expect internal controls to be in place.

Note also that trivial benefits of no more than £50 provided to employees need not be reported. This typically covers gifts to employees at Christmas and on their birthdays.

Paying tax on benefits through your payroll

Employers can deduct and pay tax on most employee expenses through your payroll (sometimes called ‘payrolling’) as long as you have registered with HMRC before the start of the tax year (6 April). This can be particularly beneficial in the first year that a company car is provided to an employee as it means that they won’t get a big tax bill at the end of the year.

Employers do not need to submit a P11D form for an employee if you’re paying tax on all their benefits through your payroll. However, they still need to submit a P11D(b) form so they can pay any Class 1A National Insurance they owe.

Taxable benefit charge - returning office equipment

Employer provided equipment

If you have supplied your employees with office equipment to allow them to work from home, without a transfer of ownership, there is no tax charge when they return the equipment back to you. If you transfer the ownership of the equipment to the employee at any stage of their employment, a benefit charge generally arises on the market value of the equipment at the time of the transfer less any amount made good by the employee. There is an alternative method for calculating the chargeable benefit when equipment is transferred, more information on this method can be found in Employment Income Manual EIM21650.

Employer reimbursed equipment

If your employee has agreed to purchase their own home office equipment for use whilst working at home as a result of coronavirus and you reimburse the exact expense, unless you have specified to your employee that they must transfer ownership to you, the ownership of the equipment rests with your employee.

There is no benefit charge on the reimbursement. There is also no benefit charge if you allow your employee to keep the equipment as it is something that they already own. Further information and to check which expenses are taxable if your employee works from home due to coronavirus is available: https://www.gov.uk/guidance/check-which-expenses-are-taxable-if-your-employee-works-from-home-due-to-coronavirus-covid-19

Please contact us if you need any help in this area.

18th June 2021 – Hillmans Weekly Update

Below I have summarised all the main tax related updates we have seen this week.

·         VAT Deferral Reminder– join online by 21 June
·         Commercial Eviction Ban Extended to March 2022
·         New tool launched to support organisations achieve Cyber Essentials certification
·         Car Benefit Reduced Where Unavailable

If you have any queries about this week’s content, or if you need any assistance please do not hesitate to contact me.

I hope you have a great weekend.

Stay safe and well.

Cheers,

Steve

Steven Hillman BSc (Hons) ACA
Chartered Accountant
Tel: 01934 444100

Commercial Eviction Ban Extended to March 2022

The government has announced this week that it has extended a ban on commercial evictions until the 25th March 2022, which was due to end on the 30th June 2021.

The moratorium was first introduced in April 2020 to help commercial tenants struggling with the financial implications of COVID-19 and to protect them from eviction. 

The measures also continue to place restrictions on landlords using existing laws to recover rent arrears.

Read more here: https://www.gov.uk/government/news/further-support-for-commercial-and-residential-tenants

New tool launched to support organisations achieve Cyber Essentials certification

The Cyber Essentials Readiness Tool, which has been developed by IASME on behalf of the National Cyber Security Centre – a part of Government Communication Head Quarters – asks organisations a series of questions related to the main Cyber Essentials criteria to help prepare them for certification.

Through the Cyber Essentials scheme, businesses can learn how to defend themselves by securing internet connections and devices, controlling access to data, and understanding how to protect against malware.

You can find out more here: https://getreadyforcyberessentials.iasme.co.uk/

VAT Deferral Reminder– join online by 21 June

The VAT deferral new payment scheme is open for all businesses who deferred paying VAT due between 20 March and 30 June 2020 and were unable to pay in full by 31 March 2021.

21 June is the last day you can join this scheme. If you join by this date you can apply to spread these payments across up to eight instalments.

You can join online here:  https://www.gov.uk/guidance/deferral-of-vat-payments-due-to-coronavirus-covid-19

If you have deferred paying VAT, you may be charged a 5% penalty and/or interest if you do not join the VAT deferral new payment scheme by the deadline of 21 June, pay in full by 30 June, or get in touch with HMRC to make an alternative arrangement to pay by 30 June 2021.

See: One month left to join VAT Deferral New Payment Scheme - https://www.gov.uk/government/news/one-month-left-to-join-vat-deferral-new-payment-scheme

Car Benefit Reduced Where Unavailable

P11d forms reporting benefits in kind provided to employees and directors need to be submitted to HMRC by 6 July. Where a company car is “unavailable” for private use for 30 or more consecutive days the benefit is proportionately reduced.

During the various lockdown periods many employees and directors have not been using their company cars and it may have been sitting on their driveway. Unfortunately, that does not count as being unavailable.

HMRC have confirmed that they would continue to regard the car as available to the employee unless the keys or fobs are returned to the employer or to a third party such as the leasing or disposal company as instructed by the employer.

Note that where the employee is provided with a motor car with zero CO2 emissions there is no taxable benefit in kind for 2020/21 although the charge increases to 1% of original list price for 2021/22.

11th June 2021 – Hillmans Weekly Update

Below I have summarised all the main tax related updates we have seen this week.

• Output VAT on the supply of private road fuel
• Check that your shares qualify for CGT Business Asset Disposal Relief
• Recovery of VAT on Electric car charging
• Reimburse private fuel by 6 July to avoid fuel benefit

If you have any queries about this week’s content, or if you need any assistance please do not hesitate to contact me.

I hope you have a great weekend.

Stay safe and well.

Cheers,

Steve

Steven Hillman BSc (Hons) ACA
Chartered Accountant
Tel: 01934 444100

Output VAT on the supply of private road fuel

HMRC have amended the VAT road fuel scale charges with effect from 1 May 2021.

Businesses must use the new scales from the start of the next prescribed accounting period beginning on or after 1 May 2021.

The valuation rate tables:

• set out the new scale charges (a VAT inclusive amount)
• show the VAT to be charged if you account for VAT on an annual, quarterly or monthly basis
• must be operated in accordance with the notes to the valuation table

Notes to the CO2 emission figures

You will need to check your car’s CO2 emissions figure if you cannot get this from your log book.

Where the CO2 emission figure is not a multiple of 5, the figure is rounded down to the next multiple of 5 to determine the level of the charge.

For a bi-fuel vehicle which has two CO2 emissions figures, the lower of the 2 figures should be used. For cars which are too old to have a CO2 emissions figure, you should identify the CO2 band based on engine size. If its cylinder capacity is:

• 1,400cc or less: use CO2 band 140
• 1,401cc to 2,000cc: use CO2 band 175
• 2,001cc or above: use band 225 or more

Using the table

You need to choose the correct road fuel charge based on the CO2 emission and the length of your VAT accounting period (either 1 month, 3 months or 12 months).

You will need to apportion the fuel scale charge if you change car during the accounting period and, at the end of the period, you do not own or have not been allocated the car.

You need to work out how much of the accounting period you used each car for, and record this as a percentage of the accounting period. You must apply this percentage to each road fuel scale charge to get a total figure.

See: VAT road fuel scale charges from 1 May 2021 to 30 April 2022 - https://www.gov.uk/guidance/vat-road-fuel-scale-charges-from-1-may-2021-to-30-april-2022

Check that your shares qualify for CGT Business Asset Disposal Relief

A recent case before the tax tribunal has confirmed that all of a company’s shares are ordinary shares except those that carry a fixed rate of return.

This is crucial as CGT business asset disposal (BAD) relief requires a shareholder to be entitled to at least 5% of a company’s ordinary share capital in addition to being an officer or employee of the company, and for the company to be a trading company or the holding company of a trading group.

These conditions need to be satisfied throughout the 24 months prior to the disposal of the shares. This two-year rule is important if you are considering transferring some of your shares to other family members now that only the first £1 million qualifies for CGT BADR.

There are a number of further conditions that need to be satisfied by the shareholding in addition to the 5% ordinary share capital test. The shareholder must have 5% or more voting control and be entitled to 5% or more of the company’s distributable profits, and of its assets should be company be wound up. Those final two conditions do not need to be satisfied where the shareholder would be entitled to receive at least 5% of the proceeds on the hypothetical sale of the whole company.

This tends to be a problem area where a company has a number of different classes of shares.

If that is the case please contact us so that we can check the eligibility of different shareholders.

Recovery of VAT on Electric car charging

The government are committed to encouraging more and more people to drive electric cars and have reduced or eliminated the income tax benefits of providing electric company cars or charging points for employees. Since 6 April 2019 there has been no taxable benefit for employees where they use an electric charging point at their place of work, provided the facility is available to all staff. But what are the VAT implications of the supply of electricity and what if public charging points are used?

HMRC have issued Revenue and Customs Brief 7 (2021) which explains HMRC’s policy concerning the VAT treatment of charging of electric vehicles when using charging points situated in various public places.

The brief clarifies that supplies of electric vehicle charging through charging points in public places are charged at the standard rate of VAT. It also explains when input tax can be recovered for charging electric vehicles for business purposes.

The HMRC brief confirms that input tax can be recovered on electricity used to fuel a car intended for business use where:

• The charging takes place at the business premises of the VAT-registered business
• The charging is at the home of a sole proprietor

VAT cannot be recovered where the charging is at the home of an employee as the supply is then not made to the company.

Where employees charge an employer’s electric vehicle (for both business and private use) at the employer’s premises the employee needs to keep a record of their business and private mileage so that the employer can work out the amounts of business use and private use for the vehicle.

It is hoped that a simpler system can be found such as a scale charge similar to that used for the supply of fuel for private use.

See: Revenue and Customs Brief 7 (2021): VAT liability of charging of electric vehicles -https://www.gov.uk/government/publications/revenue-and-customs-brief-7-2021-vat-liability-of-charging-of-electric-vehicles/

Reimburse private fuel by 6 July to avoid fuel benefit

One consequence of the recent periods of lockdown is that employees may have driven fewer private miles in their company cars, particularly where they have not been driving to the office.

If they are to avoid being taxed on the provision of private fuel, they need to fully reimburse their employer for the cost of private fuel by 6 July 2021 for the 2020/21 tax year. If not, the benefit needs to be reported on the employee’s form P11d for 2020/21.

Note that the CO2 emissions percentage for the car is multiplied by the £24,500 notional list price used to calculate the benefit for 2020/21. For example, a director driving a Mercedes Benz E200 saloon company car (CO2 emissions 169g per km) would be assessed on 37% = £9,065 for 2020/21. If they are a higher rate taxpayer that would mean £3,626 tax. That would be an awful lot of private fuel!

In addition to the tax payable by the director on the provision of private fuel, there would be £1,251 Class 1A national insurance contributions payable by the employer.

Note that the private fuel benefit is an all or nothing benefit. There must be full reimbursement by 6 July 2021 to eliminate the benefit. The simplest method would be to multiply private miles by the HMRC advisory fuel rate for the vehicle which is amended every 3 months.

Advisory fuel rates from 1 June 2021

These are the suggested reimbursement rates for employees' private mileage using their company car from 1 June 2021. Where there has been a change the previous rate is shown in brackets.

Note that for hybrid cars you must use the petrol or diesel rate. You can continue to use the previous rates for up to 1 month from the date the new rates apply.

For earlier quarterly figures see: Advisory fuel rates https://www.gov.uk/guidance/advisory-fuel-rates

Recovery of Input VAT on Employee Fuel

These HMRC advisory fuel rates may also be used to calculate input VAT that may be claimed by the employer where an employee uses their own car for business journeys. The tax free reimbursement amount continues to be 45p per mile (plus 5p per passenger) so for a 1800 cc diesel car 11p of the 45p is deemed to be diesel and 20/120 of that amount, 1.83 pence per mile, may be reclaimed by the employer provided there are petrol station receipts to cover the amounts claimed.

4th June 2021 – Hillmans Weekly Update

Below I have summarised all the main tax related updates we have seen this week.

• Self-Employment Income Support Scheme (SEISS) Fifth Grant Update
• Not all benefits need to be reported on form P11D
• The cost of Covid-19 and how this will affect your business
• VAT deferral monthly payment scheme closing soon

If you have any queries about this week’s content, or if you need any assistance please do not hesitate to contact me.

I hope you have a great weekend.

Stay safe and well.

Cheers,

Steve

Steven Hillman BSc (Hons) ACA
Chartered Accountant
Tel: 01934 444100

Self-Employment Income Support Scheme (SEISS) Fifth Grant Update

Below is a roundup the latest information on the SEISS which is extracted from HMRC, and government updates provided to us.

SEISS fourth grant

Claims for the fourth grant have now closed. The last date for making a claim was 1 June 2021.

SEISS fifth grant

A fifth grant covering May 2021 to September 2021 will be open to claims from late July 2021.

The grant is taxable and will be paid out in a single instalment. Guidance for claiming the grant will be available by the end of June 2021.

To be eligible for the grant you must be a self-employed individual or a member of a partnership.

You must have traded in the tax years:
• 2019 to 2020 and submitted your tax return on or before 2 March 2021
• 2020 to 2021

You must either:
• be currently trading but are impacted by reduced demand due to coronavirus
• have been trading but are temporarily unable to do so due to coronavirus

To work out your eligibility for the fifth grant, HMRC will first look at your 2019 to 2020 Self-Assessment tax return. Your trading profits must be no more than £50,000 and at least equal to your non-trading income.

If you’re not eligible based on your 2019 to 2020 tax return, HMRC will then look at the tax years 2016 to 2017, 2017 to 2018, 2018 to 2019 and 2019 to 2020.

You must declare that:
• you intend to continue to trade
• you reasonably believe there will be a significant reduction in your trading profits due to reduced business activity, capacity, demand or inability to trade due to coronavirus from May 2021 to September 2021

You must keep evidence that shows how your business has been impacted by coronavirus resulting in less business activity than otherwise expected.

How the fifth grant works

The amount of the fifth grant will be determined by how much your turnover has been reduced in the year April 2020 to April 2021. HMRC will provide more information and support by the end of June 2021 to help you work out how your turnover was affected.

The amount of the grant

Turnover reduction        How much you will get             Maximum grant

30% or more          80% of 3 months’ average trading profits             £7,500

less than 30%           30% of 3 months’ average trading profits             £2,850

When can you claim the grant?

The online claims service for the fifth grant will be available from late July 2021.

If you are eligible based on your tax returns, HMRC will contact you in mid-July 2021 to give you a date that you can make your claim from.

See: Self-Employment Income Support Scheme fifth grant: https://www.gov.uk/government/publications/self-employment-income-support-scheme-fifth-grant/self-employment-income-support-scheme-fifth-grant

Please contact us if you need help in making this or any other claims. We are here to support you!

Not all benefits need to be reported on form P11D

Despite the coronavirus lockdowns HMRC still expect P11d forms reporting expenses and benefits to be submitted by the normal 6 July deadline.

Remember that reimbursed expenses no longer need to be reported where they are incurred wholly, exclusively and necessarily in the performance of the employee's duties. Dispensations from reporting are no longer required, although HMRC would expect internal controls to be in place.

Note also that trivial benefits of no more than £50 provided to employees need not be reported. This typically covers gifts to employees at Christmas and on their birthdays.

The cost of Covid-19 and how this will affect your business

The cost of Covid-19

The ONS has published its latest paper on how the relationship between UK public sector monthly income and expenditure leads to changes in deficit and debt for the financial year ending 31 March 2021. The figures are subject to adjustment but show the stark reality of the effect of Covid-19 on the UK economy and the extent of government support

• Public sector net borrowing (excluding public sector banks) in the financial year ending (FYE) March 2021 is estimated to have been £303.1 billion, £246.1 billion more than in the year to March 2020 and the highest nominal public sector borrowing in any financial year since records began in 1947.

• Expressed as a ratio of gross domestic product (GDP), public sector net borrowing (excluding public sector banks) in the FYE March 2021 was 14.5%, the highest such ratio since the end of World War Two, when in FYE March 1946 it was 15.2%.

• Public sector net borrowing (excluding public sector banks) in the FYE March 2021 is estimated to have been £24.3 billion less than the £327.4 billion expected by the Office for Budget Responsibility in their Economic and Fiscal outlook – March 2021 on a like for like basis.

• Central government tax receipts are estimated to have been £523.6 billion in the FYE March 2021 (on a national accounts basis), £34.2 billion lower than in the FYE March 2020, with notable falls in taxes on production such as Value Added Tax (VAT), Business Rates and Fuel Duty.

The full ONS report can be seen here: https://www.ons.gov.uk/economy/governmentpublicsectorandtaxes/publicsectorfinance/bulletins/publicsectorfinances/march2021 

How will this affect your business?

We saw in the last budget the steps the government is taking to support the recovery with new incentives for business investment and help for businesses to attract the capital, ideas and talent to grow. Once economic recovery is durably underway, the recent budget stated that the public finances must be returned to a sustainable path and sets out the size of the challenge and steps to deliver more sustainable public finances. So in March we saw Chancellor Rishi Sunak freeze income tax thresholds and announce an increase in Corporation tax rates from 2023.

The government has chosen a fine line between raising taxes to start paying down the massive government borrowings but at the same time stimulate economic recovery and save jobs.

Most businesses will be focussing short term on their recovery and in the medium term on being resilient, improving profitability and growing turnover. If taxes do rise to fund government spending, we recommend all businesses should map out a range of scenarios with “what if” analysis to understand their available future strategies for success. 

VAT deferral monthly payment scheme closing soon

The VAT deferral new payment scheme is open for all businesses that deferred VAT due between 20 March 2020 and 30 June 2020 and were unable to pay in full by 31 March 2021.

Businesses can spread these payments over several months – businesses that join by 21 June 2021 will still be able to benefit from up to 8 monthly instalments.

Businesses can join the easy-to-use scheme quickly and simply without needing to call HMRC.

Before joining, businesses must:

• have their VAT registration number
• create their own Government Gateway account (if they do not already have one)
• submit any outstanding VAT returns from the last 4 years – otherwise they will not be able to join the scheme
• correct errors on their VAT returns as soon as possible
• make sure they know how much is owed, including the amount originally deferred and how much they may have already paid

Businesses may be charged a 5% penalty and interest if they do not either pay in full, sign up to the scheme online by 21 June 2021, or get in touch with HMRC to make an arrangement to pay by 30 June 2021.

For more information see:  VAT Deferral New Payment Scheme - https://www.gov.uk/government/news/vat-deferral-new-payment-scheme-online-service-opens