VAT explained in plain English

You must register for VAT once your taxable turnover goes over £90,000 in any rolling 12 months, or if you expect it to go over £90,000 in the next 30 days on its own. You can also choose to register voluntarily below that amount.

VAT registration on GOV.UK

A VAT return is a form with 9 boxes that tells HMRC how much VAT you charged and paid:

• Box 1: the VAT you charged on your sales.
• Box 2: VAT due on goods brought into Northern Ireland from the EU.
• Box 3: Box 1 and Box 2 added together.
• Box 4: the VAT you can reclaim on business purchases.
• Box 5: the difference between Box 3 and Box 4 — what you pay HMRC or get back.
• Box 6: your total sales, not counting VAT.
• Box 7: your total purchases, not counting VAT.
• Box 8: goods sent from Northern Ireland to the EU, not counting VAT.
• Box 9: goods brought into Northern Ireland from the EU, not counting VAT.

Your VAT return is usually due 1 calendar month and 7 days after the end of your VAT period. You pay any VAT you owe by the same date.

Under Making Tax Digital, VAT returns are sent through HMRC-recognised software. If your records are in a spreadsheet, bridging software can send the figures for you. An accountant can also submit for you.

AutoTax AI prepares your VAT figures, but it doesn't submit VAT returns to HMRC yet. You can copy the figures into recognised software or download them for your accountant.

Find software that works with Making Tax Digital for VATVAT returns on GOV.UK

Keep digital records of your sales, purchases and the VAT on each. Keep them for at least 6 years.