VAT direct debits to be cancelled by HMRC

HMRC warns that VAT direct debits are set to be cancelled if no email address is held.

VAT direct debits to be cancelled by HMRC. To comply with new UK banking regulations, HMRC now need to hold an email address in order to take payments by direct debit. Therefore, if no email address is held existing VAT direct debit mandates will be cancelled.

HMRC are writing to businesses who pay their VAT by direct debit, but for whom they do not hold an email address. 

Those affected, will receive a letter from HMRC informing them their VAT direct debit will be cancelled between July and November. If recipients want to continue to pay by direct debit, they will need to set up a new mandate via their Business Tax Account.

Unfortunately, businesses will not know exactly when their record is going to be transferred. So it is advised to check for the prompt in advance to ensure any direct debit payments continue uninterrupted.

What you need to do…

HMRC’s security requirements now prohibit agents from setting up direct debits on behalf of clients.

We recommend you follow the steps below:

  • Please check your Business Tax Account (BTA) as soon as possible
  • When your current VAT period ends, log in to your BTA and select the VAT card.
  • If you receive a prompt to set up a new direct debit, follow the on-screen instructions.
  • If you do not receive a prompt, check again at the end of your next VAT period.
  • You must setup a new direct debit at least 10 days before your next VAT payment is due.


HMRC has confirmed that any direct debit mandate set up to pay deferred VAT is completely separate and therefore unaffected.

If you wish to discuss your business or personal finances with a member of our team, please get in touch.