HMRC have announced that the current penalty regime relating to late submission and late payments of VAT returns will change in April 2022. HMRC have also announced changes to the payment of interest to and by HMRC.
Currently default surcharges are issued with increasing percentages for repeated late submissions and payments. The current default surcharges range from 2% to 15% of the VAT due to HMRC.
The changes will bring in a new point-based regime for the late submission of VAT returns, together with the payment of both a percentage of the unpaid VAT and late payment interest for late payments of VAT. HMRC claim that the new regime is intended to penalise only the small number of businesses/individuals who persistently miss their payment and submission deadlines.
In addition to the changes for the late submission and late payment of VAT returns, HMRC are introducing repayment interest to replace the repayment supplement, for late repayments of VAT.
Source Moore and Smalley
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