Coronavirus (COVID-19) is having a huge impact on the economy and our daily lives. In order to support businesses, the Treasury has announced VAT measures to help them. The UK is not the only country to do this. There are many others who have brought in similar things in order to support both the domestic and global economy. This is something we have kept up to date with as a part of our work to offer VAT returns in Soho.
The VAT reliefs to be aware of
These VAT relief measures include:
- Waiving Import VAT and Customs Duty for crucial medical equipment. This includes COVID-19 test kits, ventilators, and protective clothing. These all play a vital role in combating the virus.
- A VAT return payment holiday. This is for 20th March 2020 – 30 June 2020. You won’t have to apply to take advantage but might want to cancel your direct debit to avoid payments being automatically taken.
- Sympathetic handling when it comes to time to pay other VAT return payment requests out of this period.
Taxpayers will have until the end of the 2020-2021 tax year to pay liabilities that have built up throughout this deferral period. The Government will pay out VAT refunds and reclaims normally. With everything going on, compliance obligations are still in place, and you should submit returns normally.
HMRC communication
People looking for responses from HMRC should expect delays. This is understandable with staff shortages. Furthermore, there might be a delay with communications sent via Royal Mail due to a reduction in services and a very busy period for mail. Electronic correspondence is the best hope during these times. While there are delays, HMRC will continue to respond when they can.
The future
Thankfully, the Government did introduce these measures quickly. It also looks as though they will extend them if they deem this necessary as time goes on. In a normal situation, HMRC penalties can be quite severe. However, they are usually mitigated with a ‘reasonable excuse’. So, it is incredibly unlikely they will pursue penalties that arise from defaults that are because of the health emergency.
Need help with VAT returns in Soho?
We do our best to keep up to date with the world of finance so that we can provide our clients with comprehensive support. This includes through our various services including VAT returns in Soho.
Should you ever require our help, do not hesitate to reach out. We would be happy to answer any questions you might have as best as we can.