Value Added Tax (VAT) is a significant source of revenue for the United Kingdom's government, accounting for a substantial portion of its tax income. VAT is levied on the value added to goods and services at each stage of production or distribution. For businesses operating in the UK, adhering to VAT deadlines is crucial to ensure accurate reporting and timely payments. This article outlines the key VAT deadlines that businesses in the UK need to be aware of each year.

1. VAT Registration Deadlines

Businesses that meet or exceed the UK's VAT registration threshold, which is currently £85,000 in annual turnover, must register for VAT with HM Revenue & Customs (HMRC). This registration should take place within 30 days of reaching the threshold. Failing to register on time may result in penalties. Additionally, voluntary VAT registration is possible even if turnover doesn't reach the threshold.

2. VAT Return Filing Deadlines - 1 month & 7 days after the end of the accounting period

VAT-registered businesses in the UK are required to file VAT returns periodically, typically on a quarterly basis. The deadlines for filing VAT returns and making payments are usually one month and seven days after the end of each accounting period, respectively. So, for a VAT quarter ending 30 June, the filing would be due by 7 August.

However, businesses can apply for the Annual Accounting Scheme, which extends the filing deadline to two months after the end of the accounting year, simplifying the process for certain small businesses.

3. VAT Payment Deadlines - same as the filing deadline

VAT payments are due based on the VAT return filing frequency chosen by the business. The payment due date is usually the same as the filing deadline. It's essential to have funds available to cover the VAT liability to avoid late payment penalties or interest charges.

4. Making Tax Digital (MTD) for VAT

As part of the Making Tax Digital initiative, VAT-registered businesses with a taxable turnover above the VAT threshold must use HMRC-approved software to keep digital records and submit VAT returns electronically. This requirement aims to improve accuracy and efficiency in VAT reporting. Businesses should ensure they are compliant with MTD regulations to avoid penalties.

5. EC Sales List Deadlines

If a UK business makes supplies of goods or services to VAT-registered customers in other EU countries, it needs to submit an EC Sales List. This report details the value of supplies made and customer VAT registration numbers. The deadline for submitting EC Sales Lists is usually the same as the VAT return filing deadline.

6. VAT Annual Adjustment Deadlines

Businesses in the UK may need to make annual adjustments to their VAT calculations for various reasons, such as correcting errors, adjusting for bad debts, or accounting for stock and assets. These adjustments should be made on the VAT return for the period in which the adjustment is identified.

Whilst the above provides a general guide, Remember, the VAT circumstances relating to each business will be unique, and may differ. Compliance with VAT deadlines is a fundamental aspect of running a successful business in the United Kingdom. Missing these deadlines can result in financial penalties and disruptions in business operations. UK businesses must stay well-informed about the specific VAT deadlines relevant to their operations, use approved digital record-keeping software if required, and allocate resources to meet these deadlines consistently. Seeking guidance from tax professionals and using appropriate accounting tools will contribute significantly to ensuring timely and accurate VAT reporting and payments.

At Beancrunch, we specialise in helping small businesses comply with VAT requirements. To find out more about how we can help you, click here:

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