Just for reference, here's the penalties for a late VAT return or payment (linky):
First default - no penalty, you get a letter. If you miss another return or payment in the next 12 months, you get...
Second default - no penalty. Surcharge liability letter. If you miss another return or payment in the next 12 months, you get...
Third default - 2% penalty (unless it's less than £400, in which case, no penalty). If you miss another return or payment in the next 12 months, you get...
Fourth default - 5% penalty (unless it's less than £400, in which case, no penalty). If you miss another return or payment in the next 12 months, you get...
Fifth default - 10% penalty (unless it's less than £30, in which case, £30). If you miss another return or payment in the next 12 months, you get...
Sixth default - 15% penalty (unless it's less than £30, in which case, £30).
So by my reckoning, you have at least six months (two defaults) before they hit you with a penalty. You might want to confirm that with your professional advisors, though.
First default - no penalty, you get a letter. If you miss another return or payment in the next 12 months, you get...
Second default - no penalty. Surcharge liability letter. If you miss another return or payment in the next 12 months, you get...
Third default - 2% penalty (unless it's less than £400, in which case, no penalty). If you miss another return or payment in the next 12 months, you get...
Fourth default - 5% penalty (unless it's less than £400, in which case, no penalty). If you miss another return or payment in the next 12 months, you get...
Fifth default - 10% penalty (unless it's less than £30, in which case, £30). If you miss another return or payment in the next 12 months, you get...
Sixth default - 15% penalty (unless it's less than £30, in which case, £30).
So by my reckoning, you have at least six months (two defaults) before they hit you with a penalty. You might want to confirm that with your professional advisors, though.
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