VAT Returns & MTD Compliance.
VAT is not your money. We file your returns on time, keep your digital links unbroken under MTD, and make sure you're on the right scheme from the start.
Book a VAT review
Where we help
VAT collected from customers is not yours to keep, but VAT you have paid can reduce what you owe. We prepare and file your VAT returns on time, keep your digital records and MTD links in order, and make sure you are using the right VAT scheme for your business.
Crossing the threshold for the first time. Hitting the rolling £90,000 turnover figure is a tricky time: you have thirty days to register, decisions to take on which scheme to choose, and pricing conversations to have with customers who weren't expecting VAT to land on their invoice. We watch the rolling twelve-month figure for you and go through the options before the deadline arrives.
Backdating pre-registration VAT. Once you register, you can usually reclaim VAT on goods bought up to four years before registration that are still in use, and on services received in the six months before. That is real money sitting on receipts you may have written off. We go through the ledger with you on day one and pull out everything that qualifies.
Through the quarter, the cloud accounting platform we configure captures receipts and invoices as they arrive, applies the correct VAT treatment, and feeds the figures into the return. Before the return is filed, we can tell you where the VAT bill is heading, with the formal figure reconciled and submitted on time. The cloud accounting page covers the platform side.
What happens each quarter
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1
Continuous Capture
Receipts and sales invoices are captured through the receipt tool or bank feeds.
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2
Running indication of the VAT position
Before the return is filed, we give you an indication of where the VAT bill is heading, so the quarter-end figure is not the first time you see it.
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3
Filing the return with HMRC
Once you have signed off the figures, the return is locked and submitted straight from the cloud accounting platform to HMRC, with the digital chain MTD requires.
You keep the records clean, we manage the rest
Day-to-day, your job is to send invoices, capture receipts, and keep the bookkeeping side of the cloud platform up to date. From there, we take over: reconciling the ledger, applying the right VAT treatment to anything ambiguous, giving you an indication of the position before filing, and filing the return on time when the quarter closes. The same fee can cover your digital bookkeeping and VAT MTD setup.
Choosing the right VAT scheme
The wrong VAT scheme can quietly cost you money over time. During onboarding we look at your trading pattern and recommend the scheme that fits, Standard, Flat Rate, or Cash Accounting, and switch you across if needed. Changing schemes is straightforward, and we can move between them as the business changes shape.
Standard Accounting
You reclaim VAT on your purchases and pay VAT on your sales based on the invoice date.
Businesses that are paid quickly or have a high volume of standard-rated purchases.
Cash Accounting Scheme
You only pay HMRC the VAT on your sales once your customer has paid you. If a client pays late, you do not fund their VAT bill.
Agencies, consultants, and B2B services suffering from slow-paying clients.
Flat Rate Scheme
You charge standard VAT but pay HMRC a fixed percentage of your gross turnover. You cannot reclaim VAT on most purchases (except capital assets over £2,000).
Low-cost service businesses (though the 'Limited Cost Trader' rules make this less beneficial than it once was).
Where VAT gets awkward
Some sectors need more careful VAT treatment. In construction, the Domestic Reverse Charge can change who accounts for VAT within the supply chain. In e-commerce, platform payouts often arrive after fees, refunds and reserves have already been deducted, so the figures need to be broken back down properly. Cross-border sales can also bring OSS or IOSS into play. We help make sure the right VAT treatment is applied from the start, rather than corrected after the quarter has ended.
E-commerce & Marketplace VAT
Amazon, Shopify and Stripe do not deposit neat totals. They deduct fees, withhold reserves and cross borders. We use integration middleware to unpick your payout settlements, applying the correct domestic, zero or exempt rates so the gross sales line on your VAT return ties back to the underlying transactions rather than being reassembled at quarter-end.
Construction Domestic Reverse Charge
The Domestic Reverse Charge (DRC) shifted who accounts for VAT inside the construction supply chain. If you are a subcontractor or main contractor working under the Construction Industry Scheme (CIS), your invoices need to state the DRC applies and your return needs the input and output tax aligned correctly. Otherwise the cashflow goes wrong before HMRC ever notices the paperwork has.
Frequently asked questions
VAT, MTD and the points-based penalty regime
What is the current VAT registration threshold?
Currently, you must legally register for VAT if your VAT-taxable turnover exceeds £90,000 in a rolling 12-month period, or if you expect it to cross this threshold in the next 30 days. Use our VAT Scheme Comparison to compare Standard, Flat Rate and Cash schemes, and we keep an eye on your turnover so you never face late-registration penalties.
How does the HMRC VAT penalty point system work?
HMRC replaced the default surcharge with a points-based regime. You receive one point for every missed submission deadline. Once you hit the threshold (4 points for quarterly returns), you receive a fixed £200 penalty, followed by further penalties for every subsequent failure. Late payment triggers separate, escalating financial penalties.
Can you fix a mess from my previous accountant?
Yes. We routinely run a VAT health check during the onboarding process to correct historical miscalculations, reconcile aged balances, and bring your ledger back into line with the position HMRC has on file.
Keep reading
Digital Bookkeeping
Accurate ledgers keep VAT filings clear and on time.
ServiceSmall Business Accountants
Full-service compliance for growing businesses approaching the VAT threshold.
GuideMTD for ITSA guide
The Making Tax Digital rules and quarterly reporting requirements for Income Tax.
Check your VAT scheme before the next return.
We review Standard, Flat Rate and Cash Accounting against your actual sales mix, expense base and cashflow profile, recommend the scheme that fits, and lock in the digital chain HMRC looks for under MTD.
Review your VAT schemeSheffield and Mansfield
VAT returns and MTD for UK limited companies in South Yorkshire, the East Midlands and across the UK, with the work run through secure cloud records and scheduled calls.