We understand that filing a VAT return can be a complex and time-consuming process. However, Making Tax Digital (MTD) is helping to address some of the most common issues you face when submitting your return.  

You must be registered for VAT if your business: 

• Sells goods or services which are subject to VAT 

• Has a turnover of £90,000 or more each year 

VAT must be reported to HM Revenue & Customs (HMRC) at least once every three months. Why? To tell HMRC: 

• How much VAT you have charged and paid 

• How much VAT you owe 

• If there are any errors in your records  

Your VAT return requires you to provide detailed financial information to work out how much VAT you owe in each period, so it can be easy to make a mistake.  

Recognising and avoiding the most common causes of errors can save your business time, money, and potential legal complications.   

Making Tax Digital  

Mistakes in VAT payment and record-keeping are easy to make for businesses, so the Government has implemented reforms in how businesses maintain and file their records through MTD. 

All businesses registered for VAT must now keep digital financial records and submit returns using MTD-compatible software.  

Businesses could now face fines amounting to up to 100 per cent of the unpaid VAT for both negligent and intentional discrepancies in their returns, so accurate records are essential for MTD compliance. 

Addressing your challenges 

MTD helps businesses address the most common VAT filing errors, enhancing accuracy of each submission and a reduced risk of penalties – for example: 

• Incorrect rates – Different goods and services are taxed at different rates (20 per cent, 10 per cent or zero-rated) and applying the wrong VAT rate can lead to substantial discrepancies in your return.  

• Missed discrepancies – Submission of your VAT return is required every three months, giving HMRC more of a real-time overview of your business and more opportunities to flag any issues.  

• Errors in records – VAT returns require detailed invoices, receipts, and proof of any adjustments or corrections, so the right record-keeping system can capture all VAT-related transactions and place that information at your fingertips.  

• Missed deadlines – VAT returns and payments have specific deadlines and returns can take up a lot of time, with queries often arising at the last minute. MTD supports automated reminders and ready access to resources, which can reduce the risk of missing a deadline. 

Complying with MTD is a legal requirement, but it is also an opportunity for your business to review its record-keeping and VAT submission processes.     

We can advise you on this element of your operations and support you with VAT returns and submission preparation – creating a more efficient and compliant operation for your business. 

Contact us today and speak to us about how we can help you with VAT.