If you have a business registered in the UK, you must pay tax on it. Not only do you have to pay your taxes correctly, but you also have to pay them before the deadline. Besides knowing the correct laws of tax filing, you should also learn about the VAT return deadlines. It’s mandatory to know these rules; otherwise, you might face problems like penalties. It can be confusing sometimes because of the laws, different methods and new updated rules. But don’t worry! We are here to help you.
At the end of this guide, you will know how can pay your VAT returns before their deadlines, rules, and smart tips in the UK, following proper law and skipping penalties.
In This Guide, We’ll Cover
What Is a VAT Return?
A VAT ( Value Added Tax) return is a document that details the VAT owed on sales and the VAT that can be claimed on purchases. You send the documents to HM Revenue & Customs, known as HMRC. A VAT return also tells you if you have any due or a refund from HMRC. You are bound to pay the VAT returns if your business is registered in the UK, whether you have no VAT to pay or reclaim for that period.
Who Needs to File a VAT Return in The UK?
All VAT-registered businesses must file VAT returns if they have no VAT to pay, including:
- When a registered business reaches the VAT payment gateway of £90,000 yearly
- If the business exceeds the yearly VAT turnover
- When registering for reclaim on expenses or demanding more established clients, though the income is below the yearly threshold
- If the business uses any VAT scheme, like the standard or flat rate scheme
- For worldwide or EU export and import businesses
- To avoid penalties or late fines by HMRC due to missing the deadlines
- When you owe money from foreign income and charity
What are VAT Return Deadlines?
VAT return deadlines refer to the official dates set by HM Revenue and Customs (HMRC). You must submit and pay your VAT by this time, even if you have no VAT. These deadlines apply every tax year, depending on the VAT return types.
When Is the VAT Return Deadline in the UK?
The VAT return deadline for the majority of businesses is one month and seven days following the conclusion of the accounting period. For example:
- Your VAT return and payment are due on August 7th if your VAT accounting period ends on June 30th.
- If your period ends on 31 December, the deadline will be 7 February.
So you are given 37 days from the end of your VAT period to file your return and pay the required VAT.
VAT Return Deadlines Types
Two types of VAT returns deadlines are:
1. Quarterly VAT Returns (Most Common)
Most of the businesses in the UK pay their VAT returns quarterly. The deadline can vary according to your business’s needs. Common VAT quarters include:
| Vat Period | Vat Return Due Date |
| January – March | 7 May |
| April – June | 7 August |
| July – September | 7 November |
| October – December | 7 February |
2. Annual VAT Returns
Some businesses can pay taxes annually. In this case, you pay your VAT returns at once. However, the HMRC can take advance payments from your whole VAT return, and you pay the rest of the amount. You have two months after the last day of the VAT year to pay your yearly VAT.
Penalties for Missing VAT Deadlines
From January 2023, HMRC introduced a points-based penalty system for late submission.
| Freequency | Penalty Points |
| Each missed deadline | 1 point |
| Reach penalty point threshold | £200 penalty |
| additional late submission | Another £200 penalty |
- Smart Tips: Hiring small business accountants in London helps you to submit according to deadlines, avoiding penalties, and save your money with peace of mind.
Changes to VAT Filing (MTD)
The UK government’s Making Tax Digital (MTD) program mandates that companies use compatible software to file their VAT returns and maintain their VAT records digitally. This change helps make tax reporting more accurate and efficient by reducing manual errors. All businesses in the UK that are registered for VAT must follow Making Tax Digital rules as of April 2022.
- You have to keep digital VAT records.
- You have to use MTD-compatible accounting software to submit your VAT returns.
MTD doesn’t control the VAT deadlines. But it may alter how you send your VAT return.
VAT Payment Methods and Timing
HMRC offer different payment methods based on timing. You can choose any payment method to meet your VAT return deadlines.
| Payment Method | Processing Time |
| Faster Payments (online/mobile) | Same day |
| CHAPS | Same day |
| Bacs | 3 working days |
| Direct Debit | 3 working days |
| Standing Order (Annual Scheme) | Varies |
HMRC will still count your payment as late if it arrives late due to delayed bank processing.
How to Check the Deadline for Your VAT Return
Check your VAT return carefully, including:
- By logging into your HMRC VAT online account.
- Through your accounting software.
- Contacting HMRC.
Drawbacks of Failing VAT Returns Deadline
Following the deadline is crucial for business success. Otherwise, you have to face unnecessary spending for late submission.
1. Late Penalties
1 deadline miss = 1 penalty point. When you reach your threshold, HMRC will charge you £200. For further lateness, an additional £200 will be charged as a late fee. If you pay within 15 days of the due date, there is no penalty.
2. Late Payment Interest
You need to pay the first penalty fee at 2% rate for (16-30) days late. After 30+ days, a late 2% extra will be added. Plus, 4% annual rate will be calculated from day 31 till payment as a daily penalty. If you agree to pay the full payment within 30 days, for the returns due between 1st January to 31st December 2024, HMRC can waive the first penalty.
3. Surcharge Period Risk
HMRC can keep you in a 12-month surcharge if you pay VAT late. For further delay, the surcharge extends another 12 months, which can transform into financial penalties. The surcharge increases each time failure within that period.
Tips to avoid VAT Returns Deadline
You can avoid missing the deadline by following these smart tips:
1. Set reminders if you don’t want to miss the deadline
2. Keep updating your records daily
3. Use MTD-compatible software
4. Submit the file as early as possible
5. Know your VAT plan
Final Words
To avoid losing extra money and harming the business, skip the last-minute submission. We, S&B Accountants, are a top-rated and industry-leading accounting firm in London. Our tax advisors work transparently to make VAT payment methods accurate within HMRC deadlines for limited companies, sole traders, partnerships, and self-employed businesses.
Frequently Asked Questions
- What is a VAT return in the UK?
A VAT Return is a form you fill in to tell HM Revenue and Customs ( HMRC ) how much VAT you’ve collected and the amount of VAT you have paid to other businesses.
- What date is the VAT return in the UK?
Although deadlines can vary depending on your scheme, in the UK, VAT returns and payments are typically due by the seventh day of the second month following the end of your VAT period.
- How often does VAT return in the UK?
Mostly, you have to send a VAT Return quarterly to HMRC, known as an ‘accounting period’. Even if you have zero VAT to pay, you must submit the VAT Return.
- Is VAT return monthly or quarterly?
In the UK, VAT returns are mostly quarterly. But some businesses also pay monthly or annually.
- What is a quarterly VAT?
When you pay your VAT Returns every 3 months in a year, it is called quarterly VAT.
