Farming and rural businesses that deferred VAT must pay by 31 March 2021 unless they have opted in to a new scheme to pay by instalments.
Deferred VAT liabilities under the government’s VAT deferral scheme - a Covid-19 measure introduced last year - must be paid up in full next month.
However, farming and rural businesses who want to take advantage of the pay in instalments opportunity must opt in.
Accountancy firm Saffery Champness said this must be done by the taxpayer themselves rather than their agent or another third party on their behalf.
Nick Hart, director, said: "Under the scheme, the deferred liability must be paid in full by 31 March 2022 through equal monthly instalments, 11 being the maximum number of instalments allowed."
The opting in process became available on Tuesday (23 February) and taxpayers have until 21 June 2021 to opt in.
Acceptance into the scheme by HMRC is dependent on the taxpayer still having deferred VAT to pay, being up to date with their VAT returns. paying the first instalment when opting in and paying the remaining instalments by Direct Debit.
Mr Hart said the instalment scheme cannot be used to pay any other VAT liabilities apart from the deferred liability from last year.
"Specific time to pay arrangements can be discussed with HMRC in respect of any other VAT debts," he added.
"There are very limited opportunities for a VAT error which occurred in a VAT period which was deferred, to be included in the amount to be paid in instalments."
Taxpayers will need to set up an online account as the opting in process is completed through the government gateway.
The number of instalments available to settle the deferred liability will depend on when the opting in process is completed.
If opting in is completed by 19 March 2021, taxpayers can benefit from having the maximum of 11 instalments.
