A VAT return reports the VAT you charged on sales and the VAT you paid on purchases for the period, usually a quarter. You pay HMRC the difference, or reclaim it if you paid more than you charged. Under Making Tax Digital it must be filed from compatible software.
General guidance for UK businesses, not tax advice. Rates, thresholds and deadlines change — check gov.uk, or ask your accountant, before acting on anything here.
LAST REVIEWED 27 AUGUST 2026 · BIZZLE
Nine boxes, and for most small businesses only a handful matter: VAT due on sales, VAT reclaimed on purchases, the net amount payable or reclaimable, and the total values of sales and purchases excluding VAT.
The figures are not a calculation you perform at quarter end. They are a summary of transactions already recorded. If the bookkeeping is current the return takes minutes; if it is not, the return is not the problem — the records are.
For standard quarterly returns, filing and payment are both due one calendar month and seven days after the end of the VAT period. A quarter ending 31 March is due 7 May.
Payment must clear by the deadline, so a bank transfer sent on the day may be late. Direct debit is collected a few working days after the filing deadline, which effectively buys a little time.
Late filing and late payment are penalised under a points-based system. Repeated small slips accumulate into a penalty, which is a change from how it used to work.
Make sure the period is complete
Every sale invoiced, every purchase recorded, every bank transaction reconciled. Anything missing is a correction later.
Check the awkward items
Fuel, entertainment, mixed-use purchases and anything with partial recovery. These are where errors cluster.
Review the figures against last quarter
A number that has moved sharply is either a real change in trading or a mistake. Knowing which takes two minutes now and an afternoon later.
Submit through compatible software
Making Tax Digital requires the return to be filed from software with a digital link to your records. Typing figures into a website is no longer allowed.
Pay, or set up the direct debit
Pay by the deadline or have the direct debit in place well before it — new mandates take a few working days to activate.
| Scheme | How it works | Suits |
|---|---|---|
| Standard | VAT on invoices raised and received, whether or not paid | Most businesses, particularly those reclaiming a lot |
| Cash accounting | VAT on money actually received and paid | Businesses paid slowly, because you do not fund VAT on unpaid invoices |
| Flat rate | A fixed percentage of gross turnover, with limited reclaims | Simple businesses with few costs — check the limited cost rules |
| Annual accounting | One return a year with instalments | Businesses wanting fewer filings and predictable payments |
TERMS USED ON THIS PAGE
COMMON QUESTIONS
Small errors within the correction threshold can usually be adjusted on the next return. Larger ones need separate disclosure to HMRC. Telling them before they find it is treated very differently from the alternative.
Yes, if you are VAT registered. Making Tax Digital requires digital records and filing from compatible software with digital links — manually retyping figures into a portal is not permitted.
Contact HMRC before the deadline rather than after. Time to Pay arrangements exist and are far easier to agree before you have defaulted. Interest still accrues, but penalties and enforcement are what really hurt.
Yes. A nil return is still a return, and not filing one earns a penalty point exactly as a late one does. If you had purchases with VAT on them it is also a repayment, which is the one kind of VAT return worth looking forward to.
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