Sending a VAT Return
Late returns and payment
If you miss the deadline for submitting your return, HMRC will send you a ‘VAT notice of assessment of tax’ telling you how much VAT they think you owe.
You may need to pay a surcharge or penalty for submitting your return after the deadline or paying it late.
The amount you owe will be worked out differently, depending on which accounting period it’s for.
You should contact HM Revenue and Customs (HMRC) as soon as possible if you’re having difficulty paying by the deadline.
If your accounting period started on or after 1 January 2023
You’ll get separate penalties for submitting your return late and paying late.
If you submit your return late
For each VAT Return you send late, you’ll get a penalty point. This includes nil returns (where you have nothing to declare).
Once you reach your penalty point threshold, you’ll get a £200 penalty. The threshold is set by your accounting period (if you pay monthly, quarterly or annually).
You’ll get a further £200 penalty for each subsequent late submission while you’re at the threshold.
You can see how many points you have in your online account.
Submit future returns on time to remove penalty points from your account.
If you make a late payment
You could get a penalty if you pay late:
- on your VAT Return
- following an amendment to a return or correction
- from a VAT assessment HMRC issued when you did not submit your return
- from a VAT assessment HMRC issued for another reason
How much you’ll be charged depends on how late you pay.
The penalty amount goes up after 16 days, and then again after 31 days.
You’ll be charged late payment interest from the first day your payment is overdue, until you pay in full. This also applies if you’re paying in instalments.
If your accounting period started on or before 31 December 2022
HMRC will record a ‘default’ on your account if you’re late with your VAT Return or payment.
Getting a default may put you in a ‘surcharge period’ of 12 months. If you get another default during the 12-month period, you may have to pay an extra amount (a ‘surcharge’) on top of the VAT you owe.
You do not pay a surcharge the first time you default.
Entering a surcharge period
You will enter a 12-month surcharge period if you’re late submitting your payment, and your turnover is £150,000 or more.
If your turnover is under £150,000, you will enter a 12-month surcharge period if you’re late submitting your payment twice in 12 months.
If you’re late submitting your return or payment in a surcharge period
Your 12-month surcharge period will restart if you’re late submitting your return.
If you’re late submitting your payment, your 12-month surcharge period will restart and you might need to pay a surcharge.
How much you pay
The surcharge is a percentage of the outstanding VAT for the period in default. It’s calculated on the due date.
This table shows how much you’ll be charged if you default within a surcharge period. HMRC will write to you explaining any surcharges you owe.
| Defaults within 12 months | Surcharge if annual turnover is less than £150,000 | Surcharge if annual turnover is £150,000 or more |
|---|---|---|
| 2nd | No surcharge | 2% (no surcharge if this is less than £400) |
| 3rd | 2% (no surcharge if this is less than £400) | 5% (no surcharge if this is less than £400) |
| 4th | 5% (no surcharge if this is less than £400) | 10% or £30 (whichever is more) |
| 5th | 10% or £30 (whichever is more) | 15% or £30 (whichever is more) |
| 6 or more | 15% or £30 (whichever is more) | 15% or £30 (whichever is more) |
There’s no penalty for a late nil return (where you have nothing to declare).
If your VAT notice of assessment of tax is wrong
If the assessment is too high, send a correct VAT Return and VAT payment.
If the assessment is too low you need to either:
- tell HMRC within 30 days
- send a correct VAT Return and VAT payment
Otherwise, you might be charged a penalty (up to 30% of the assessment).
How to pay a surcharge or penalty
There are several ways you can pay your VAT bill, including any surcharges and penalties.