Can HMRC contact you?

Since the introduction of MTD, HMRC has had 2 systems handling VAT returns and payments; one for MTD users and one for non-MTD users.

In April 2021 they began migration to a single system for both but they have apparently run into problems that may result in direct debits payments for returns not being taken

This problem has apparently occurred due to the way HMRC comply with banking regulations that require them provide advance confirmation to businesses of the amount of payment to be taken under the direct debit and when that payment will be taken.

Due to the short period between the submission of the VAT return and the payment being due, this confirmation is sent to the business by email, and this is where the problem lies.

Unfortunately, where HMRC’s records do have the businesses valid email address, the migration of the systems will mean that HMRC will not be able to comply with the banking regulation requirements and so will cancel the business’s direct debit, presumably without any notification being sent to the business, and the businesses will instead have to pay by alternative means and may risk missing the payment deadline. 

For businesses that are signed up for MTD, HMRC’s records will usually already hold the businesses valid email address but it seems imperative that ALL businesses should ensure that HMRC hold their valid email address so that the payment by direct debit continues.

This should be done as soon as possible but apparently certainly before the end of June 2021.

The email address must be the valid email address for the business, not their agent/accountant and can be provided to HMRC by entering into the general information part of the Business Tax Account or via the Agent Services Account.