August 14, 2008When is the VAT return due?

This is an easy one - the VAT return is due on the last day of the month following the end of the VAT quarter. Well, that is not always the case.

When the due date for the VAT return falls on a weekend or a bank holiday HMRC say they will exercise their discretion and not record the return as being late as long as it is received on the next working day (see policy statement below). However you can’t rely on this discretion always being exercised in your clients’ favour, or indeed the postal system actually delivering the VAT return on time.

What about VAT returns submitted over the internet? HMRC are desperate to get more traders to submit VAT returns online, so they allow a further seven calendar days in which to submit the VAT return figures online. The downside is an online VAT return cannot be matched to a cheque payment of VAT, so any VAT due must also be paid electronically such as by the Bankers Automated Clearing System, (BACS) or by setting up a direct debit. The direct debit option gives the trader at least 10 more days use of the VAT receipts. What’s more the VAT return can be submitted at any time after the end of the quarter but the VAT due is not collected by direct debit until the due date, including the extra 10 days.

Example
The VAT return for the quarter to 30 June 2008 was due on 31 July 2008, if it was completed on paper. If the VAT return was submitted online the due date was 7 August 2008, which was the same day the BACS payment should have reached HMRC. However, where a direct debit has been set up in advance of the VAT return being submitted, the VAT due for the quarter to 30 June 2008 was collected on 12 August, as 9 and 10 August were a weekend.

HMRC policy on VAT returns

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