Jun 11

What to know about VAT return deadlines and penalties

HMRC has reminded taxpayers that VAT return deadlines are not extended when they fall on a weekend or bank holiday.

Due date reminder

The due date for submitting quarterly VAT returns is one month plus seven days after the end of the quarter. So, for the quarter ending 30 June, that’s 7 August:

  • It is the same deadline for paying HMRC, although you need to allow time for a payment to clear HMRC’s account.
  • If you use the annual accounting scheme, the VAT return is normally due two months after the end of the accounting period.

HMRC has responded to a growing trend of late VAT return submissions and VAT payments based on incorrect information provided by artificial intelligence (AI) and third-party websites. VAT returns can be submitted over the weekend or on a bank holiday, and, if this is not possible, a return should be submitted on the last working day prior to the due date.

Penalty warning

Despite HMRC’s warning, taxpayers who are occasionally late should avoid any penalty except for late payment interest:

  • Late payment penalty: HMRC only charges a penalty if a VAT payment is made more than 15 days late, so this will not be an issue if a taxpayer simply waits until the first working day after the payment deadline.
  • Late submission penalty: Being a day late will mean a penalty point is incurred, but there is no £200 penalty until a threshold of four points is reached (two points if submitted annually), and points expire after 24 months, provided the taxpayer remains below the threshold.
  • Late payment interest: This is charged – currently at a rate of 7.75% – from the due date to the date of payment. For instance, being ten days late on a VAT payment of £40,000 will see interest of just under £85 being charged.

Submitting one late quarterly VAT return each year should not lead to a late submission penalty being charged.

HMRC guidance on penalty points and penalties if you submit your VAT Return late can be found here.

For more information, contact us on 0330 1070 873 or email info@smh.group.