A VAT return is a report submitted to HMRC that shows how much VAT you have charged on sales and how much VAT you have paid on expenses.
The difference determines whether you pay VAT or receive a refund.
A VAT return typically includes:
Total VAT charged on sales (output VAT)
Total VAT paid on expenses (input VAT)
The amount of VAT owed or reclaimable
To complete a VAT return:
Calculate VAT on your sales
Calculate VAT on your expenses
Subtract expenses VAT from sales VAT
Submit the return to HMRC
What is a VAT Return?
A VAT return is a report submitted to HMRC that shows how much VAT you owe or can reclaim.
It includes:
- VAT on your sales (output VAT)
- VAT on your purchases (input VAT)
The difference between these determines whether you pay HMRC or receive a refund.
A VAT return is a report submitted to HMRC that shows how much VAT you have charged on sales and how much VAT you have paid on expenses.
The difference determines whether you pay VAT or receive a refund.
Who Needs to Submit a VAT Return?
You must submit a VAT return if your business is registered for VAT in the UK.
Most businesses submit returns every 3 months, although some may submit monthly or annually, depending on their scheme.
A VAT return typically includes:
Total VAT charged on sales (output VAT)
Total VAT paid on expenses (input VAT)
The amount of VAT owed or reclaimable
What Information is Included in a VAT Return?
To complete a VAT return:
Calculate VAT on your sales
Calculate VAT on your expenses
Subtract expenses VAT from sales VAT
Submit the return to HMRC
A VAT return includes several key figures:
- Total sales and purchases
- VAT owed on sales
- VAT reclaimable on purchases
- Net VAT to pay or reclaim
These figures must be calculated accurately before submission.
VAT returns must be submitted by specific deadlines.
See our VAT Deadlines UK guide to ensure you submit on time.
How to Complete a VAT Return (Step-by-Step)
To complete a VAT return:
- Record all your sales and purchases
- Calculate VAT on your sales (output VAT)
- Calculate VAT on your expenses (input VAT)
- Subtract input VAT from output VAT
- Submit your VAT return to HMRC
- Pay any VAT owed or receive a refund
If your input VAT is higher, HMRC will refund the difference.
VAT returns must be submitted by specific deadlines.
See our VAT Deadlines UK guide to ensure you submit on time.
How to Complete a VAT Return (Step-by-Step)
- Record all your sales and purchases
- Calculate VAT on your sales (output VAT)
- Calculate VAT on your expenses (input VAT)
- Subtract input VAT from output VAT
- Submit your VAT return to HMRC
- Pay any VAT owed or receive a refund
Tip: Accurate record-keeping is essential when completing a VAT return, as HMRC may request supporting evidence.
How to Calculate VAT for Your Return
Before submitting your VAT return, you need to calculate VAT accurately.
To add VAT:
Multiply by 1.20
To remove VAT:
Divide by 1.20
Example:
£100 × 1.20 = £120
£120 ÷ 1.20 = £100
Use a VAT Calculator to prepare your return.
Preparing a VAT return involves multiple calculations.
Use our VAT calculator to quickly work out VAT on your sales and purchases and ensure your figures are accurate.
You can also learn how to claim VAT back using our step-by-step guide.
VAT Return FAQs
How often do I submit a VAT return?
Most businesses submit VAT returns quarterly, although some schemes allow different frequencies.
How long do I have to submit a VAT return?
You usually have one month and 7 days after the end of the VAT period to submit your return.
What happens if I submit late?
Late submissions can result in penalties and interest from HMRC.
You may also find these helpful:
VAT Calculator UK
VAT Registration UK
VAT on Expenses
VAT Deadlines UK
These guides help you understand and manage VAT returns.
You may also find these helpful:
VAT Calculator UK
VAT Registration UK
VAT on Expenses
VAT Deadlines UK
These guides help you understand and manage VAT returns.
Disclaimer
This guide is for general information only. While every effort is made to ensure accuracy, we are an independent resource and not affiliated with HMRC. Always consult a qualified professional for financial decisions.