UK: Tax relief allows for tax deferrals (COVID-19)

UK: Tax relief allows for tax deferrals (COVID-19)

The UK government announced certain tax relief measures in response to the coronavirus (COVID-19) pandemic.


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The tax relief includes deferral of certain value added tax (VAT) and income tax payments. HM Revenue & Customs (HMRC) also has allowed businesses affected by COVID-19 to defer payment of other taxes under “time to pay arrangements.”

UK VAT-registered businesses with a VAT payment due between 20 March 2020 and 30 June 2020, have the option to:

  • Defer the payment until a later date, or
  • Pay the VAT due as normal

Taxpayers with income tax payments due on 31 July 2020 (“payments on account”) may defer these payments until 31 January 2021, and HMRC will not automatically impose penalties or interest for late payment of tax. The deferment is optional.

Read an April 2020 report prepared by the KPMG member firm in the UK

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