How to Complete and File Your VAT Return: Guides

Introduction

Completing and submitting a VAT return is one of the most important ongoing obligations for any VAT-registered business in the UK. A VAT return is not simply an administrative requirement — it is the primary mechanism through which HM Revenue & Customs assesses whether your business has calculated VAT correctly, paid the right amount, or is entitled to a refund.

For many businesses, VAT returns are also one of the most stressful aspects of tax compliance. Even experienced business owners regularly ask questions such as:

• How do I complete a VAT return correctly?
• Which figures go into each VAT box?
• How do I submit a VAT return under Making Tax Digital?
• Why has my VAT refund been delayed or queried?
• What happens if I make a mistake?

These questions are particularly common for small and growing businesses, where VAT obligations often increase in complexity as turnover grows, costs change, or international transactions are introduced.

This VAT Returns & Filing Guides hub is designed as a practical, step-by-step resource for UK businesses. It explains:

• How VAT returns work in practice
• How to complete each section correctly
• How to submit VAT returns digitally under MTD
• How VAT payments and refunds are processed
• How to avoid common errors that lead to penalties or HMRC enquiries

Whether you are filing your first VAT return, managing routine quarterly submissions, or dealing with VAT refunds, corrections, or HMRC queries, this hub will guide you through the process with clarity and confidence.

What Is a VAT Return?

A VAT return is a periodic report submitted to HMRC that summarises your business’s VAT activity for a specific accounting period. It shows:

• VAT charged to customers on taxable sales (output VAT)
• VAT paid on business purchases (input VAT)
• The net VAT position, indicating whether VAT is payable to HMRC or refundable to your business

The VAT return ensures that VAT is collected and reclaimed correctly across the supply chain, with businesses acting as intermediaries rather than bearing the tax cost themselves.

How Often VAT Returns Are Submitted

Most VAT-registered businesses submit VAT returns:

• Quarterly (the most common arrangement)

However, depending on the VAT accounting scheme used, returns may also be:

• Monthly, often where regular VAT refunds are expected
• Annually, under the Annual Accounting Scheme

The frequency affects cash flow, payment timing, and refund speed, making it an important planning consideration.

What a VAT Return Does — and Does Not — Include

A VAT return:

• Summarises VAT totals for the period
• Reports figures into standard VAT boxes
• Is submitted digitally under Making Tax Digital rules

However, a VAT return does not require you to upload invoices or receipts at the point of submission.

That said, businesses must:

• Hold valid VAT invoices for all VAT reclaimed
• Maintain accurate digital records
• Retain VAT records for at least six years

HMRC may request supporting documentation at any time, particularly where refunds are claimed or figures appear unusual.

Why VAT Returns Matter Beyond Compliance

While VAT returns are a compliance requirement, they also:

• Directly affect cash flow through payments or refunds
• Provide HMRC with insight into business activity
• Influence the likelihood of compliance checks or inspections

Consistently accurate VAT returns reduce the risk of HMRC queries, delays, and penalties, while poor-quality returns often trigger additional scrutiny.

Who Needs to Submit a VAT Return?

Any business that is registered for VAT in the UK is legally required to submit VAT returns to HM Revenue & Customs, regardless of size, turnover, or trading activity during the period.

This requirement applies to all VAT-registered entities, including:

• Sole traders, whether operating independently or with staff
• Limited companies, including trading companies and holding companies
• Partnerships, including LLPs
• Charities and non-profit organisations that are registered for VAT

Importantly, VAT returns must be submitted even if there is no VAT to pay or reclaim for the period. These are often referred to as nil VAT returns.

Failing to submit a VAT return on time is treated as a compliance failure, even where:

• No VAT is due
• The business has ceased trading temporarily
• The business is waiting for a VAT refund

HMRC does not accept “no activity” as a reason for non-submission. Repeated failures to submit VAT returns can result in penalties, compliance points, and increased scrutiny of future returns.

VAT Return Deadlines Explained

VAT returns follow strict statutory deadlines. For most VAT-registered businesses, the deadline is:

One month and 7 days after the end of the VAT period

Example VAT Return Deadline

• VAT period end date: 31 March
• VAT return submission deadline: 7 May
• VAT payment deadline: 7 May

Both submission and payment must be completed by the deadline. Submitting the return on time but paying late — or paying on time but submitting late — can still trigger penalties.

How VAT Deadlines Affect Cash Flow

VAT deadlines are particularly important for cash flow planning. Businesses should ensure that:

• VAT liabilities are calculated early
• Funds are set aside ahead of the deadline
• Refund expectations are factored into cash planning

Late filing or late payment can trigger penalties under HMRC’s VAT penalty system, including:

• Late submission penalty points
• Interest on overdue VAT
• Compliance monitoring for repeat offenders

Setting reminders and using accounting software with deadline alerts can significantly reduce the risk of missed deadlines.

Understanding the VAT Return Boxes (Boxes 1–9)

A standard UK VAT return consists of nine boxes, each capturing a different element of your VAT activity for the period. Understanding what belongs in each box is essential to submitting an accurate return.

Box 1 – VAT Due on Sales and Outputs

This box shows:

• VAT charged on taxable sales to customers
• VAT due on other outputs, such as:
  • Reverse charge supplies (where applicable)
  • Certain self-accounted VAT entries

Errors here often involve:

• Using the wrong VAT rate
• Charging VAT when the supply is outside the scope
• Failing to apply reverse charge rules correctly

Box 2 – VAT Due on Acquisitions from the EU

Historically, this box recorded VAT due on goods acquired from EU member states. Post-Brexit, its use is now limited and applies only in specific legacy or transitional scenarios.

Many businesses now leave Box 2 as £0, but incorrect entries can still cause confusion or HMRC queries.

Box 3 – Total VAT Due

This box is the total VAT liability for the period, calculated as:

Box 1 + Box 2

It represents the total VAT your business owes before deducting any reclaimable VAT.

Box 4 – VAT Reclaimed on Purchases and Expenses

Box 4 shows:

• VAT paid on allowable business purchases
• VAT on expenses supported by valid VAT invoices

This is one of the most heavily scrutinised boxes, particularly where:

• Refunds are claimed
• Amounts increase significantly compared to previous periods

Claiming VAT without valid invoices or on blocked expenses is a common cause of HMRC checks.

Box 5 – Net VAT Payable or Refundable

Box 5 shows the net VAT position for the period:

• If Box 3 > Box 4 → VAT payable to HMRC
• If Box 4 > Box 3 → VAT refund due to the business

This box determines whether money leaves or enters the business, making accuracy critical.

Box 6 – Total Value of Sales (Excluding VAT)

This box records the total value of:

• All sales made during the period
• Excluding VAT

It includes:

• Standard-rated sales
• Zero-rated sales
• Certain outside-the-scope supplies

Errors in Box 6 often occur when:

• VAT-inclusive figures are entered by mistake
• Overseas or outside-the-scope income is omitted

HMRC frequently cross-checks Box 6 against income patterns and previous returns.

Box 7 – Total Value of Purchases (Excluding VAT)

Box 7 shows the total value of:

• Business purchases and expenses
• Excluding VAT

This includes:

• Purchases where VAT is reclaimable
• Purchases where VAT is not reclaimable

Discrepancies between Boxes 4 and 7 can trigger questions, especially where large expenses are reported without corresponding VAT reclaims.

Box 8 – EU Supplies of Goods (Historical Relevance)

Previously used to report goods supplied to EU VAT-registered customers. Post-Brexit, this box is rarely used and applies only in limited circumstances.

Box 9 – EU Acquisitions of Goods (Historical Relevance)

Previously used to report goods acquired from EU suppliers. Like Box 8, its relevance is now limited post-Brexit.

Boxes Most Likely to Trigger HMRC Checks

HMRC scrutiny most commonly focuses on:

• Box 1 – VAT charged incorrectly
• Box 4 – Overclaimed or unsupported VAT
• Box 6 – Inconsistent sales reporting

Understanding how these boxes interact is essential to avoiding unnecessary queries, delays, or penalties.

How to Complete a VAT Return Correctly

Completing a VAT return correctly is essential not only to meet legal requirements, but also to protect your business from penalties, delayed refunds, and unnecessary HMRC scrutiny. A well-prepared VAT return should accurately reflect your business activity for the period and be fully supported by your accounting records.

To complete a VAT return accurately, businesses should follow a structured review process:

Ensure All Sales Invoices Are Included

All taxable sales made during the VAT period must be included, regardless of whether the customer has paid. This includes:

• Standard-rated sales
• Zero-rated sales
• Reverse charge supplies (where applicable)
• Certain outside-the-scope income

Omitting invoices — even unintentionally — can result in underdeclared VAT and future assessments.

Confirm Correct VAT Rates Have Been Applied

Each sale and purchase must be reviewed to ensure the correct VAT rate has been used:

• Standard rate (20%)
• Reduced rate (5%)
• Zero rate (0%)
• Outside the scope of VAT

Using the wrong rate is one of the most common VAT errors and often leads to HMRC corrections or penalties, particularly in sectors with mixed supplies.

Reconcile VAT Figures to Accounting Records

Before submission, VAT figures should be reconciled against:

• Accounting software reports
• Sales ledgers
• Purchase ledgers
• Bank transactions

Reconciliation ensures that:

• All transactions are captured
• VAT totals match underlying records
• No duplication or omission has occurred

This step is especially important for businesses using spreadsheets or multiple systems.

Check for Blocked or Restricted VAT

Not all VAT paid by a business is reclaimable. Before completing the return, businesses should review expenses for:

• Client entertaining and hospitality
• Personal or mixed-use items
• Certain vehicle-related costs
• Expenses without valid VAT invoices

Claiming blocked VAT is one of the most frequent reasons HMRC reduces or queries VAT refund claims.

Review Unusual or Large Figures

Unusual movements in VAT figures — particularly in Boxes 1, 4, or 6 — should always be reviewed and explained internally before submission. Large increases may arise due to:

• Capital purchases
• Imports
• Changes in business activity

Where appropriate, preparing a brief explanation in advance can help if HMRC raises queries.

Accuracy is especially critical when VAT refunds are being claimed, as repayment returns are more likely to be reviewed by HM Revenue & Customs.

Making Tax Digital (MTD) and VAT Returns

Making Tax Digital (MTD) for VAT fundamentally changed how VAT returns are prepared and submitted in the UK. Most VAT-registered businesses are now legally required to comply with MTD rules.

Under MTD for VAT, businesses must:

• Keep VAT records digitally, including sales and purchase data
• Use MTD-compatible software to maintain records and calculate VAT
• Submit VAT returns electronically through approved software

Manual submissions through the old HMRC VAT portal are no longer permitted for most businesses, unless a formal exemption has been granted.

MTD-Compatible Software Options

To comply with MTD, businesses typically use one of the following approaches:

Cloud Accounting Software

These platforms maintain full digital records and submit VAT returns directly to HMRC. They are commonly used by small and medium-sized businesses.

Spreadsheet + Bridging Software

Businesses that rely on spreadsheets may remain compliant by using bridging software, which digitally links spreadsheet data to HMRC’s systems without manual re-entry.

Digital Links and Common Compliance Issues

A key MTD requirement is the use of digital links. This means VAT data must flow electronically between systems. Manual copying and pasting of figures breaks digital links and is not compliant.

Broken digital links are one of the most frequent MTD compliance issues and a common trigger for HMRC queries.

How to Submit a VAT Return

VAT returns must be submitted:

• Through MTD-compatible software
• By the statutory VAT deadline
• Using accurate digital records that support the figures submitted

Once a VAT return is submitted:

• You receive an electronic submission confirmation from HMRC
• The return is treated as final
• Figures cannot be edited or overwritten directly

Correcting Errors After Submission

If an error is discovered after submission:

• Small errors may be corrected on a future VAT return
• Larger errors require a formal VAT correction or disclosure

Ignoring errors or attempting to “fix” them informally increases compliance risk and may lead to penalties.

Accurate VAT return preparation, supported by proper digital systems and regular reviews, is one of the most effective ways to reduce VAT risk and maintain a smooth relationship with HMRC.

VAT Payments and VAT Refunds

Once a VAT return has been completed and submitted, the next critical step is either paying VAT to HMRC or receiving a VAT refund, depending on the business’s net VAT position for the period. Understanding how VAT payments and refunds work — and how HMRC processes them — is essential for cash-flow planning and compliance.

Paying VAT

If your VAT return shows that VAT is payable, the amount due must reach HM Revenue & Customs by the VAT deadline.

Key points to be aware of:

• Payment must be received by HMRC, not merely initiated, by the deadline
• VAT is usually due one month and 7 days after the end of the VAT period
• Accepted payment methods typically include:
  • Direct debit
  • Bank transfer
  • Online card or payment services

Direct debit is often recommended, as it:

• Reduces the risk of missed deadlines
• Allows HMRC to collect payment automatically
• Provides a small additional time buffer in some cases

Late VAT payments can result in:

• Interest charged on overdue VAT
• Late payment penalties
• Increased compliance monitoring for repeat delays

Consistently late payment is a common trigger for HMRC intervention, even where VAT returns themselves are accurate.

VAT Refunds

If input VAT exceeds output VAT, your VAT return will show a repayment position, and HMRC may issue a VAT refund.

VAT refunds commonly arise where businesses:

• Incur high startup or capital costs
• Export goods or supply zero-rated services
• Import goods into the UK
• Experience temporary drops in taxable sales

How VAT Refunds Are Paid

• Refunds are usually paid directly to the bank account registered on your VAT account
• HMRC aims to issue refunds within 30 days of submission
• The repayment target applies only where no additional checks are required

Why VAT Refunds May Be Delayed

Some VAT refunds are delayed for verification. This is particularly common where:

• The refund is a first-time claim
• The refund amount is large or unusual
• Figures differ significantly from previous VAT periods
• Documentation appears incomplete or inconsistent

Delays do not necessarily mean a problem exists, but they do increase the importance of accurate records and clear audit trails.

Accurate digital records, valid VAT invoices, and well-prepared VAT returns significantly improve refund processing times.

First VAT Returns: What to Expect

First VAT returns are often treated differently by HMRC, as they provide the first insight into a newly registered business’s VAT position.

It is common for first VAT returns to:

• Show VAT refunds, due to startup and setup costs
• Be subject to additional verification checks
• Require more detailed supporting records

HMRC may request:

• VAT invoices
• Bank statements
• Explanations of business activity

This is normal and does not automatically indicate an error or compliance issue. However, businesses should be prepared to respond promptly and clearly to any requests.

Taking extra care with the first VAT return often sets the tone for smoother VAT processing in future periods.

Common VAT Return Mistakes

Even experienced businesses frequently make VAT return errors. The most common mistakes include:

• Using incorrect VAT rates, particularly where mixed supplies exist
• Claiming blocked VAT, such as client entertaining or personal expenses
• Missing invoices or insufficient evidence to support VAT reclaims
• Reporting figures in the wrong VAT boxes, especially Boxes 1, 4, and 6
• Submitting VAT returns late, even where no VAT is due
• Incorrect treatment of overseas transactions, including reverse charge errors

Many of these mistakes are avoidable with:

• Clear VAT procedures
• Regular reconciliations
• Proper use of accounting software
• Periodic VAT reviews

Consistent errors increase the likelihood of HMRC checks, delayed refunds, or penalties.

Correcting Errors on a VAT Return

Mistakes on VAT returns are more common than many businesses realise. Errors may arise from incorrect VAT rates, missed invoices, misclassified transactions, or misunderstandings of complex VAT rules. What matters most is how quickly and correctly the error is addressed.

If you discover an error on a submitted VAT return:

• Small errors may usually be corrected on the next VAT return
• Larger errors must be formally disclosed to HM Revenue & Customs
• Strict time limits apply to all VAT corrections

Prompt correction significantly reduces the risk of penalties and interest. Attempting to ignore or conceal errors often leads to higher penalties if HMRC later identifies the issue during checks or inspections.

Small vs Large VAT Errors

In general terms:

• Small errors can be adjusted through the next VAT return by increasing or decreasing the relevant VAT box figures
• Larger errors require submission of a formal VAT disclosure or error correction form

What constitutes a “small” or “large” error depends on both:

• The monetary value of the error
• The overall size and VAT turnover of the business

Errors involving overseas VAT, reverse charge supplies, or blocked VAT often require extra care, even where amounts appear modest.

Time Limits for Correcting VAT Errors

VAT correction time limits are strict. Errors must be corrected:

• Within statutory timeframes
• Before HMRC raises an enquiry or assessment

Missing these limits can result in permanent loss of VAT recovery or additional liabilities.

VAT Returns by Business Type

VAT return complexity varies significantly depending on the nature of the business. Understanding sector-specific risks is essential to completing VAT returns correctly.

• Service-based businesses often have simpler VAT returns but may face issues with reverse charge services and overseas clients
• Retailers must manage multiple VAT rates, zero-rated goods, and high transaction volumes
• Construction businesses deal with domestic reverse charge rules, subcontractor VAT, and complex supply chains
• E-commerce sellers face challenges around import VAT, postponed VAT accounting, digital marketplaces, and international reporting
• Charities and non-profits often operate under partial exemption rules and special VAT relief schemes

Applying generic VAT treatments without considering sector-specific rules is a common cause of HMRC adjustments and penalties. Sector-focused guidance is often essential.

VAT Returns and Record-Keeping Requirements

Accurate VAT returns depend on strong underlying records. UK VAT law requires businesses to retain VAT records for at least six years.

Records that must be kept include:

• Sales invoices and credit notes
• Purchase invoices and receipts
• VAT calculations and workings
• Accounting records supporting VAT figures
• Digital audit trails under Making Tax Digital (MTD)

Under MTD rules, records must be:

• Stored digitally
• Complete and accurate
• Easily accessible for HMRC inspection

Poor record-keeping is one of the most common reasons VAT returns are challenged, refunds are delayed, or penalties are issued — even where the VAT treatment itself is correct.

How This VAT Returns Hub Can Help You

This VAT Returns & Filing Guides hub is designed to support UK businesses at every stage of VAT reporting — from first registration to ongoing compliance and complex corrections.

Within this hub, you’ll find detailed sub-guides covering:

• How to complete a VAT return step by step
• How to submit VAT returns under Making Tax Digital
• How VAT payments and refunds work in practice
• Why VAT refunds may be delayed and how to respond
• How to correct VAT return errors safely and compliantly
• VAT return requirements by sector and business type

Each guide focuses on a specific aspect of VAT reporting, with practical explanations, real-world examples, and compliance-focused advice.

When to Get Professional Help with VAT Returns

While many UK businesses handle routine VAT returns internally, there are situations where professional VAT support is not just helpful, but strongly recommended. VAT rules are detailed, technical, and subject to frequent interpretation by HM Revenue & Customs. Even small errors can lead to penalties, delayed refunds, or long-running compliance issues.

Seeking expert advice early often prevents problems that are far more expensive and stressful to resolve later.

Filing Your First VAT Return

First VAT returns are a common trigger point for HMRC checks. New VAT-registered businesses often face challenges such as:

• Reclaiming pre-registration VAT correctly
• Understanding which expenses qualify
• Completing VAT boxes accurately
• Submitting returns under Making Tax Digital for the first time

Professional support at this stage helps ensure the first return is accurate, well-documented, and sets a strong compliance history from the outset.

Regularly Claiming VAT Refunds

Businesses that frequently claim VAT refunds — such as exporters, construction businesses, or capital-intensive companies — face higher HMRC scrutiny.

Professional help is valuable to:

• Ensure VAT is fully reclaimable and correctly supported
• Prepare clear audit trails and explanations
• Reduce refund delays caused by HMRC verification
• Respond efficiently to refund-related queries

Consistent refunds without proper preparation are one of the most common triggers for HMRC reviews.

Trading Internationally

International VAT adds layers of complexity, including:

• Place of supply rules
• Reverse charge mechanisms
• Import and export VAT
• Overseas VAT registrations and refunds

Errors in international VAT treatment often result in:

• Overpaid VAT that cannot be recovered
• Underpaid VAT and assessments
• Cross-border compliance issues

Professional VAT advice helps ensure overseas transactions are reported correctly and efficiently.

HMRC Queries, Penalties, or Compliance Issues

If HMRC has already:

• Raised queries on your VAT return
• Delayed or reduced a VAT refund
• Issued penalties or interest
• Opened a compliance check or inspection

professional representation becomes particularly important. A VAT specialist can:

• Communicate with HMRC on your behalf
• Prepare structured responses and documentation
• Challenge incorrect HMRC assumptions
• Reduce penalties where possible

Responding informally or without full understanding can worsen outcomes.

Complex VAT Positions

Professional help is also strongly recommended where VAT complexity arises from:

• Multiple VAT rates
• Partial exemption
• Flat Rate VAT Scheme or limited cost trader rules
• Group structures
• Mixed business and personal use expenses

In these cases, routine bookkeeping knowledge is often insufficient to manage VAT risk effectively.

Why Early Advice Matters

VAT issues rarely improve on their own. Early professional advice can:

• Prevent costly errors
• Improve VAT recovery
• Reduce compliance risk
• Save time and management stress
• Provide peace of mind

In many cases, the cost of professional VAT support is significantly lower than the cost of correcting mistakes after HMRC intervention.

Frequently Asked Questions (FAQ): VAT Returns & Filing in the UK

What is a VAT return?

A VAT return is a regular report submitted to HM Revenue & Customs that shows:

• VAT charged on sales (output VAT)
• VAT paid on purchases (input VAT)
• The net VAT payable to HMRC or refundable to the business

Most VAT-registered businesses submit VAT returns quarterly.

Who needs to submit a VAT return?

Any business that is registered for VAT must submit VAT returns, including:

• Sole traders
• Limited companies
• Partnerships
• Charities registered for VAT

A VAT return must be submitted even if there is no VAT to pay or reclaim for the period.

How often do I need to submit a VAT return?

Most businesses submit VAT returns:

• Every 3 months (quarterly)

Some businesses may submit:

• Monthly returns (often where regular refunds arise)
• Annual returns (under the Annual Accounting Scheme)

Your VAT return frequency is agreed with HMRC.

What is the deadline for submitting a VAT return?

VAT returns are usually due:

• One month and 7 days after the end of the VAT period

For example:

• VAT period ends: 30 June
• VAT return deadline: 7 August

Both submission and payment must be completed by the deadline.

What happens if I submit my VAT return late?

Late submission may result in:

• Penalty points under HMRC’s VAT penalty system
• Financial penalties if points accumulate
• Increased HMRC scrutiny

Even if no VAT is due, late submission can still trigger penalties.

How do I complete a VAT return correctly?

To complete a VAT return accurately, you should:

• Include all sales and purchase invoices for the period
• Apply the correct VAT rates
• Check for blocked or restricted VAT
• Reconcile figures to your accounting records
• Review unusual or large figures before submission

Most errors occur in Boxes 1, 4, and 6.

What do the boxes on a VAT return mean?

A standard VAT return includes nine boxes:

• Box 1 – VAT due on sales
• Box 4 – VAT reclaimed on purchases
• Box 5 – Net VAT payable or refundable
• Box 6 – Total sales value (excluding VAT)
• Box 7 – Total purchases value (excluding VAT)

Understanding these boxes is essential to avoid reporting errors.

Do I need to submit VAT returns under Making Tax Digital (MTD)?

Yes. Most VAT-registered businesses must comply with Making Tax Digital for VAT, which means:

• Keeping VAT records digitally
• Using MTD-compatible software
• Submitting VAT returns electronically

Manual submissions through the old HMRC portal are no longer allowed for most businesses.

Can I use spreadsheets for VAT returns?

Yes, but only if:

• You use bridging software that links spreadsheets to HMRC
• Digital links are maintained (no copy-and-paste of figures)

Spreadsheets alone are not MTD-compliant.

How do I submit a VAT return to HMRC?

VAT returns must be submitted:

• Through MTD-compatible accounting or bridging software
• By the VAT deadline

Once submitted:

• You receive confirmation from HMRC
• The return cannot be edited directly

How do I pay VAT after submitting my return?

If VAT is due, payment can be made by:

• Direct debit
• Bank transfer
• Online payment methods

Payment must reach HMRC by the VAT deadline, not just be initiated.

What happens if my VAT return shows a refund?

If input VAT exceeds output VAT:

• HMRC may issue a VAT refund
• Refunds are usually processed within 30 days
• First-time or large refunds may be delayed for checks

Refunds are paid directly to the bank account on your VAT record.

Why is my VAT refund delayed?

Common reasons include:

• First VAT return
• Large or unusual refund amount
• Missing or inconsistent records
• HMRC verification checks
• Outstanding VAT or tax debts

Good record-keeping helps reduce delays.

What is my first VAT return likely to look like?

First VAT returns often:

• Include startup costs
• Result in VAT refunds
• Trigger HMRC verification checks

This is normal and does not automatically indicate a problem.

Can I correct a mistake on a VAT return?

Yes. If you discover an error:

• Small errors can usually be corrected on the next VAT return
• Larger errors must be disclosed separately to HMRC
• Time limits apply

Prompt correction reduces the risk of penalties.

What are the most common VAT return mistakes?

Common errors include:

• Using the wrong VAT rate
• Claiming blocked VAT (e.g. entertaining)
• Missing invoices
• Reporting figures in the wrong boxes
• Late submission or payment
• Incorrect treatment of overseas transactions

Many mistakes are avoidable with structured processes.

How long must VAT records be kept?

VAT records must generally be kept for:

• At least 6 years

This includes:

• Sales and purchase invoices
• VAT calculations
• Accounting records
• Digital audit trails

Poor record-keeping is a major compliance risk.

Are VAT returns different for different business types?

Yes. VAT return complexity varies by business type:

• Service businesses often have simpler returns
• Retailers manage multiple VAT rates
• Construction businesses deal with reverse charge rules
• E-commerce businesses handle import VAT
• Charities may face partial exemption issues

Sector-specific guidance is often required.

Do I need an accountant to submit a VAT return?

You are not legally required to use an accountant, but professional help is strongly recommended if:

• You are filing your first VAT return
• You trade internationally
• You regularly claim VAT refunds
• HMRC has raised queries or penalties
• Your VAT position is complex

Professional review often prevents costly errors.

How Audit Consulting Group Can Help with VAT Returns

Audit Consulting Group supports UK businesses with:

• VAT return preparation and review
• Making Tax Digital compliance
• VAT refunds and repayment issues
• Error correction and disclosures
• HMRC enquiries and inspections
• Sector-specific VAT reporting

+44 7386 212550
info@auditconsultinggroup.co.uk

Final Thoughts

VAT returns are not just a formality — they are a core compliance requirement that directly affects cash flow and risk exposure. Understanding how VAT returns work, how to complete them correctly, and how to respond to issues is essential for every VAT-registered business.

This VAT Returns & Filing Guides hub provides a clear starting point for navigating VAT reporting with confidence and accuracy.