VAT returns, registration and schemes, handled for you
We tell you when to register, help you pick the VAT scheme that costs you least, and file every VAT return through Making Tax Digital software on time.
Who we help
- Businesses approaching £90,000 that need to know when to register
- Newly registered businesses filing their first returns
- Sole traders and limited companies on any VAT scheme
- Businesses that have made errors on earlier returns and need them put right
When you must register
£90,000
Taxable turnover in any rolling 12 months that makes registration compulsory
30 days
To tell HMRC, from the end of the month you went over
£88,000
Turnover below which you can apply to deregister
The test is rolling, not by tax year. At the end of every month, add up your taxable turnover for the last 12 months. You must also register straight away if you expect to go over £90,000 in the next 30 days alone.
Some businesses register voluntarily below the threshold, usually because their customers are VAT registered and can reclaim the VAT. We tell you whether it makes sense for you.
Choosing the right VAT scheme
| Scheme | How it works | Who can join |
|---|---|---|
| Standard accounting | You pay VAT on the sales you invoice and reclaim VAT on purchases. | Any VAT-registered business |
| Cash accounting | You pay VAT when your customer pays you, and reclaim it when you pay your supplier. | Taxable turnover up to £1.35 million |
| Annual accounting | One VAT return a year, with advance payments through the year. | Taxable turnover up to £1.35 million |
| Flat Rate Scheme | You pay a fixed percentage of your VAT-inclusive turnover, set by your trade. | Taxable turnover up to £150,000 |
The Flat Rate Scheme often costs more than it saves. If you spend very little on goods, HMRC treats you as a limited cost trader and your rate rises to 16.5%. We test each scheme against your real figures before you choose.
What we do for you
We register you at the right time.
We check your rolling turnover, register you with HMRC and confirm your effective date, so you start charging VAT on the right sales.
We set up your VAT codes.
In Xero or QuickBooks, every sale and purchase is coded so the return builds correctly. Coding errors are a common cause of wrong VAT returns.
We prepare and file every return.
Each quarter we review the figures, check the VAT you can reclaim and file through Making Tax Digital software once you approve.
We tell you what to pay, and when.
You get the figure and the payment date ahead of the deadline, so the money is ready.
We deal with HMRC.
VAT queries, compliance checks and corrections to earlier returns are handled by your accountant.
Deadlines and penalties
Quarter end
Your VAT period closes.
1 month and 7 days later
Your VAT return and your payment are both due.
15 days late
First late payment penalty: 3% of the VAT still unpaid.
30 days late
A further 3% of the VAT still unpaid.
31 days late onwards
A second penalty, charged daily at 10% a year until the VAT is paid.
Late payment interest is charged on top, from the first day. Late returns earn penalty points: for quarterly returns, the fourth point brings a £200 penalty, and each late return after that adds another £200.
Filing on time stops the points, even if you cannot pay in full. If cash is tight, we help you agree a payment plan with HMRC before the penalties start.
Making Tax Digital for VAT
Every VAT-registered business must keep digital records and file VAT returns through MTD-compatible software. This has applied to all VAT-registered businesses since April 2022, whatever their turnover. Our accountants are Xero Certified Advisors and QuickBooks Certified ProAdvisors, and we file through the software you already keep your books in.
Making Tax Digital for Income Tax is a separate set of rules for sole traders and landlords. See our Making Tax Digital service.
Why Penny Minders
Chartered accountants
qualified with the ICAEW and ICAS
A dedicated accountant
who knows your business
Unlimited advice
by phone and email
Fixed fees
agreed before we start
Your VAT return is only as good as your records
Missing receipts and miscoded purchases end up as VAT you overpay or VAT you have to pay back. See our Bookkeeping service.
Frequently asked questions
Answers reviewed by our accountants.
Get your VAT right from the first return
Book a free consultation and our accountants will check your turnover, your registration date and which scheme suits you.
See your price
