Avoid VAT Surcharges

File your return by the due date.


Do not assume that nil or repayment returns do not need to filed on time - they do

Remember your VAT due dates - don’t rely on HMRC to remind you

Think ahead – if the person who normally prepares or completes your VAT return is absent make alternative arrangements in good time.

If you have any problems filing your return on time – HMRC can help, call them on the VAT helpline 0300 200 3700.


Pay the VAT due by the due dates

If you can’t pay the full amount;

·        File your return on time and phone the business payment support helpline on 0300 200 3835 before the due date.

·        Pay as much as you can. This can reduce the size of any surcharge (late payment penalty).

It may even prevent you getting a surcharge all together.


Consider schemes to help with the cash flow.


Pay electronically.

We recommend paying by debit card so that the payment is classified as received the same day.

Paying by electronic transfer gives you an extra seven days for your payment to reach HMRC, unless you make payment on account or file annually for VAT. Also some banks can kick back larger payments if you haven't authorised them first.

If the seventh day is a weekend or bank holiday, payment must reach HMRC’s bank account by the last working day.


Pay by direct debit.

Think about direct debit which gives you even more time to pay.

A direct debit mandate must be in placebefore submission of your online return.


VAT accounting schemes.

Take a look at our optional accounting schemes – they may help with your cash flow. Go to www.hmrc.gov.uk/vat/start/schemes


Don’t forget …


Put your VAT Registration number in the first part of the payment reference section of your payment instructions.


Allow enough time for payment to reach HMRC’s bank account by the due date. Bank working days are Monday – Friday excluding holidays.


CHAPS and faster payment are the only method of same day payment.

Speak to your bank before making each payment, their daily cut-off time for payment instructions, and any transaction or daily limits they may impose. Other payments methods take at least three working days to reach HMRC’s bank account


Cheque Payments.

If you pay by cheque the payment is treated as received when cleared funds reach HMRC’s bank account – not the date when the cheque is received.