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HMRC Are Cancelling VAT Direct Debits

Have You Been Affected?


Posted by Alison Mead on 12/07/2021 @ 8:00AM

In April 2021, HMRC started moving the VAT records of traders who are not signed up to Making Tax Digital (MTD) for VAT from an old database (VAT mainframe or VMF) to a new database (Enterprise Tax Management Platform or ETMP) ...

Watch out for that brown envelope about your VAT Direct Debit, because you don't want to get into VAT arrears!

Watch out for that brown envelope about your VAT Direct Debit, because you don't want to get into VAT arrears!

copyright: paddythegolfer / 123rf

When a VAT record is transferred and HMRC's system does not hold a valid email address, any direct debit mandate is automatically cancelled. HMRC needs to hold a valid email address for those paying by direct debit to satisfy banking requirements.

"The taxpayer will need to set up a new mandate through their business tax account or make alternative payment arrangements!"

HMRC is writing to more than 150,000 VAT-registered businesses where they do not hold a valid email address, and the transfer of records will not commence until July 2021. This communication will explain what they need to do to continue paying their VAT by direct debit.

Watch out for that brown envelope, because you don't want to get into VAT arrears.

Until next time ...



Would you like to know more?

If anything I've written in this blog post resonates with you and you'd like to discover more, it may be a great idea to give me a call on 01604 217365 and let's see how I can help you.

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About Alison Mead ...


Alison loves bookkeeping and supporting bookkeepers. She has been helping clients to be better bookkeepers in Sage 50 for over 24 years and has been Xero Accredited in accounts and payroll for a number of years too.

She specialises in a very unique hand-holding method of training, helping bookkeepers and business owners to use their accounts software as and when they need support in setting up and producing their invoices, reports and financial information.

Alison combines her role at Silicon Bullet with her Forever Living network marketing businesses and is often to be seen at business networking meetings as she likes to keep busy.

You know what they say: if you want something done well ask a busy person!


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