How to submit a VAT return

Making Tax Digital basics

All VAT-registered businesses must keep digital records and submit returns through MTD-compatible software. Spreadsheets are allowed but only if they are linked to bridging software that submits the return digitally.

Paper returns and insolvency

If your business is subject to an insolvency procedure you must send a paper return, unless you have a CVA or IVA, in which case you can choose paper or the VAT online account. HMRC can charge a penalty of up to £400 for a paper return if you are not exempt.

Read HMRC's VAT return guidance.

Filing is only half the job. Once the return is in, see how to pay your VAT bill for the reference, bank details and timings.

What goes in each box

• Box 1: VAT due on sales and other outputs
• Box 2: VAT due on acquisitions from EU member states (if applicable, mainly Northern Ireland post-Brexit)
• Box 3: Total VAT due (Box 1 + Box 2)
• Box 4: VAT reclaimed on purchases and other inputs
• Box 5: Net VAT to pay to HMRC or reclaim from HMRC (Box 3 − Box 4)
• Box 6: Total value of sales excluding VAT
• Box 7: Total value of purchases excluding VAT
• Box 8: Total value of supplies of goods to EU (NI only post-Brexit)
• Box 9: Total value of acquisitions of goods from EU (NI only)

Pre-submission checks

• Reconcile sales total to your accounting records and bank deposits
• Confirm purchase invoices have valid VAT numbers and the correct VAT rate
• Check Box 6 (sales excluding VAT) matches your turnover for the period
• Make sure foreign-currency invoices are translated using the right exchange rate
• Look for unusual entries: duplicate invoices, missed credit notes

What to do if you discover an error after submission

• You can correct errors in returns for the preceding 4 years. Work out the net value of the errors: add up the extra tax due to HMRC and subtract the tax you are due. Deliberate errors are not included in that calculation.
• Net error of £10,000 or less, or between £10,000 and £50,000 but less than 1% of the total value of your sales: correct it on your next return. Add the net value to Box 1 if you owe HMRC, or Box 4 if HMRC owes you.
• Net error over £50,000, over £10,000 and above 1% of sales, or any deliberate error: tell HMRC separately.
• Keep a note of how the error happened. If you need to tell HMRC separately, use HMRC's error-correction process.
• Disclose deliberate errors immediately and proactively to reduce penalties

Filing and payment deadlines

For standard quarterly returns: one calendar month and seven days after the end of the VAT period. So a quarter ending 31 March is due by 7 May.

You must submit the return and make sure payment reaches HMRC on or before the deadline, even if it falls on a weekend or bank holiday. If you pay by Direct Debit, HMRC collects the payment 3 working days after the payment deadline on your return, once the Direct Debit is set up and the return is submitted.

For accounting periods starting on or after 1 January 2023, late filing uses the points-based system. Each late return, including a nil return, earns a penalty point. Once you reach your threshold you get a £200 penalty, and a further £200 for each later late return while you are at the threshold. Read more about late VAT return penalties.