Late tax payment reforms delayed for 9 months

27 January 2022

Her Majesty’s Revenue and Customs (HMRC) has announced that planned VAT penalty reforms legislated for in the Finance Act 2021 will be delayed until 1 January 2023. The reforms, initially planned to be implemented in April 2022, have been postponed allowing HMRC more time to make the necessary IT changes and employers more time to prepare.

Lucy Frazer, Financial Secretary to the Treasury, said in a statement made to the House of Commons and the House of Lords:

“HMRC is committed to becoming one of the most digitally advanced tax authorities in the world. The ambition and pace of change needs to be balanced with well-tested systems and good customer service, particularly when businesses are facing additional challenges and uncertainty.”

Until the changes are fully realised, the current Default Surcharge process will continue.

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