Government measures and changes to VAT in light of the Coronavirus outbreak
Company Director, Michael Chadwick, gives information about the Government’s Coronovirus VAT deferral scheme and the measures announced by HMRC to help us get back to work.
As well as support for employee’s wages, support for the self-employed and relief from business rates, the Government has announced a delay to the payment of certain taxes in an attempt to keep the cash flow of businesses progressing in the wake of lockdown and COVID-19.
One of the most significant measures is to defer the VAT payments due in March, April and May till the end of March 2021. The returns need to be prepared and filled as usual. It is then the responsibility of the company directors to cancel the direct debit to HMRC in order to delay the payment. Read our blog on VAT and income tax deferral for further details.
VAT on PPE
The Government has announced that in an attempt to return us all to work, the VAT on personal protective equipment will be temporarily reduced to zero.
The goods in question are, surgical masks, respirators, face visors, gloves and aprons and the reduction in VAT will last from 1 May until 31 July 2020.
The measures are especially aimed at care homes and businesses that are unable to reclaim VAT as they make exempt supplies or are not VAT registered. However, all offices, factories and retailers may benefit from the now reduced price products.
VAT scrapped on ePublications
In addition, HMRC has announced that the VAT on ePublications has been scrapped to 0%. This measure was first announced as part of the Chancellor’s budget in March and was expected to take effect from 1 December 2020.
However, the Government has fast-tracked this to make the cost of reading newspapers and eBooks more accessible, as more of us stay at home and home school our children.
We are here to help
If you would like to talk to a qualified accountant or tax specialist about these measures, or any other financial matter, then please do not hesitate to get in touch. We are now operating a ‘virtual office’ with Directors and Senior Managers still available to respond to calls and emails, so we are on hand to offer support and guidance for your business throughout this testing time.