HMRC VAT Deferral New Payment Scheme

Published: 23/02/2021 By Bradley Suckling

HMRC have announced a new VAT deferral payment scheme for VAT payments still outstanding from the payment period 20th March 2020 to 30th June 2020. The VAT deferral new payment scheme is open from 23 February 2021 up to and including 21 June 2021 and allows you to pay your deferred VAT in equal instalments, interest free; and choose the number of instalments, from two to 11 (depending on when you join).

Anyone on the VAT Annual Accounting Scheme or the VAT Payment on Account Scheme will be invited to join the new payment scheme later in March 2021.

To use the online service to register for the scheme, VAT registered businesses must:

  • have their own Government Gateway account with VAT registered as a service
  • join the scheme themselves, as an agent or accountant cannot do this on their behalf
  • still have deferred VAT to pay
  • be up to date with their VAT returns
  • join by 21 June 2021
  • pay the first instalment when you join and
  •  pay instalments by direct debit (if want to use the scheme but cannot pay by direct debit, there’s an alternative entry route for you).

If you join the scheme, you can still have a Time to Pay arrangement for other HMRC debts and outstanding tax.

If you join by: Max No. of installments
21 April 2021 10

If you want to join the new payment scheme, but cannot use the online service, contact HMRC’s Covid-19 helpline from 23rd February 2021 on 0800 024 1222.

Interest and/or a penalty may be charged if you do not pay the deferred VAT in full by 31 March 2021 or opt into the new payment scheme by 21 June 2021 or agree extra help to pay with HMRC by 30 June 2021.
Further guidance can be found at 

If you have any queries regarding any of the above please do not hesitate to contact us, call us on 020 8661 7878 or e-mail or fill out or contact form here.