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Can I do a VAT return online?

October 5, 2021This article was updated 16th September 2022.

In this article, we’ll go through how to submit your VAT return, what's included in your return and what to do if you make a mistake in your submission.

Can I do a VAT return online?

What is a VAT return?

A VAT return is a form showing how much VAT you owe to or are owed from HMRC.

What’s included on a VAT return?

Your VAT return should include:

Your total sales and purchases across a 3-month accounting periodThe amount of VAT you owe for salesThe amount of VAT you can reclaim for purchases made by your business

When is my VAT return due?

You must file a VAT return to HMRC once every 3 months at the end of what's known as your accounting period. If you're VAT registered, you'll need to submit a return – even if you have no VAT to pay or reclaim.If you're on a VAT scheme, the dates you need to file your VAT returns may vary, depending on the scheme you're under. We've outlined more details around these schemes below, but you can find the exact dates you need to both file your VAT returns and pay your VAT bills via your online account.

VAT schemes

If you’re struggling to keep on top of your VAT bills, you may be eligible to opt into a VAT scheme.These schemes are designed to help VAT-registered business owners pay their tax bills without disrupting their cash flow.

VAT Flat Rate Scheme

Under the VAT Flat Rate Scheme, VAT-registered business owners pay a fixed rate of your annual turnover towards your VAT bill, keeping the difference between what you charge your customers and what you owe to HMRC.If you're struggling to keep on top of your cash flow, you might find the VAT Flat Rate Scheme beneficial since the amount of VAT charged under this scheme is less than the 20% standard rate of VAT. However, you won't be able to reclaim the VAT you pay on purchases from suppliers.You can join the scheme online when you first register your business for VAT. To join, you must meet the following criteria:

You’re a VAT-registered businessYou expect your VAT taxable turnover to be £150,000 or less excluding VAT in the next 12 months

VAT Cash Accounting Scheme

To calculate the total amount of VAT you owe, you’ll typically need to work out the difference between your sales invoices and purchase invoices — even if the invoices you’ve sent to clients are still yet to be paid.Under the Cash Accounting Scheme, things look a little different. You can:

Pay VAT on your sales when your customers pay youReclaim VAT on your purchases when you’ve paid your supplier

You also won't have to declare your input or output tax on your return until your customers have paid you, and you've paid your suppliers.

VAT Annual Accounting Scheme

Under the Annual Accounting Scheme you only complete one VAT return each year, instead of the usual 4.This isn't to say you'll be lumped with a hefty tax bill at the end of the year – in fact, under this scheme you can pay your bill off in monthly or quarterly instalments.A few more benefits of the scheme:

Additional payments can be made as and when you can afford themFiling once a year can free up more time for you to focus on your businessYou have 2 months – instead of 1 – to submit your return and balancing paymentYou can simplify your end-of-year accounts by aligning your VAT year with your business tax year

Under this scheme, HMRC works out what you owe based on previous VAT returns, or an estimation if you’re new to VAT. Once they’ve worked out how much you owe, they’ll send you a letter detailing your VAT payment due dates and how much each instalment will be.After submitting your VAT return at the end of the year, if you’ve paid more than the amount due, the tax office will give you a VAT refund within 10 days.To join the scheme, your taxable sales for the next 12 months must be less than £1.35m excluding VAT.

What if I make a mistake on my VAT return?

Here's where double-checking your return before you file matters – undeclared mistakes on your return could cost you up to 15% of your tax bill. This is just if you make a mistake, however – careless or deliberate inaccuracies can result in a penalty of up to 100% of any tax under-stated or overclaimed. Ouch.To minimise your risk of being fined, time is of the essence. If you notice the mistake before you've filed your return, simply amend the error and make a clear note in your records of what the error was and how you've amended it.

Keep in mind that as a VAT-registered business owner, you must submit a VAT return even if you don’t have to pay or claim back any VAT – unless, of course, your business is VAT-exempt.