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Friday, April 19, 2024

All you need to know about VAT return filing 

A value-added tax (VAT) Return helps HMRC determine how much a business should pay or expect to get back. Most of the time, VAT returns and payments must be sent to HMRC every three months. To be assured of the best outcomes, it is recommended to hire reliable VAT return filing services.

When you start your business, you must know what taxes you may have to pay. You don’t always have to sign up for VAT, and it’s essential to know when and how you might be affected.

Defining a VAT Return:

If you fill out a VAT Return, it will show either how much you owe HMRC or if you are due a refund. If the amount you can get back is more than the VAT you must pay on sales, HMRC will give you the extra money. To know more, you can hire professional VAT return filing services.

These returns differ from the tax returns that small business owners, sole traders, and self-employed people file yearly. In those cases, the tax is based on the profits declared.

When you buy goods or services for your business, the company you buy them from may charge you VAT. So you have to keep track of all of these purchases made with VAT. Then, if you sell something to a client, you must know if it is a “taxable supply.”

When should I register my business for VAT?

Some things you can do in a foreign country that might mean you have to pay VAT include: 

  • Bringing goods into the country to sell or distribute later, 
  • Storing goods in a warehouse to sell or distribute later,
  • Buying and selling goods in the country, 
  • Selling goods over the internet (but only if you make a certain amount of money), 
  • Holding events in the country, and 
  • Offering people telecommunications, broadcasting, or electronic services.

Your business must comply with local VAT regulations if it engages in any of the aforementioned activities or any others that trigger VAT duties, either domestically or in a foreign nation with a VAT mechanism, and if its annual sales volume exceeds a particular level. For example, it may involve signing up for VAT and submitting regular returns.

Deadlines for filing:

International VAT obligations are complicated and vary significantly from one tax jurisdiction to another and from one business activity to another. In addition, different countries have their deadlines and rules for filing VAT returns and different administrative procedures for doing so. This makes it complicated and expensive for internal staff to ensure everyone follows the rules.

Some countries are required to report things at very specific times.

Any business registered for VAT must send their VAT filings promptly and within stringent deadlines. If a business doesn’t file its global tax returns, it could have to pay huge fines and penalties.

Take charge of your VAT obligations:

Over 60% of businesses don’t pay their VAT bills because they can’t see and keep track of everything. Some of the reasons for this are:

  • Broken paper trails, separate data systems, variable deadlines, unstructured internal processes, and blunders due to a lack of understanding are expected outcomes of managing compliance in-house.
  • Companies needed help with visibility and control when outsourcing to traditional providers since they had to work with various contacts in different areas, frequently with no centralised point of reference or control.

How do I use the Online VAT Filing System?

The Directorate of Commercial Taxes gives each person or business registered under the VAT Act of 2003 a user ID and a password. Users must use this ID and password to get into the VAT e-filing system. You could also contact the Directorate’s help desk to get the login information.

The benefits of submitting VAT returns electronically:

Maintaining compliance with your tax obligations is facilitated by filing your VAT returns online. The following are some of the main benefits of submitting VAT returns online.

  • Online filing of VAT is a less arduous and less time-consuming method as compared to the manual filing of VAT; 
  • Uploaded information specific to a business expedites the processing of VAT returns.
  • There will be fewer questions from users and fewer opportunities for error if forms are validated on the server after they have been filled out. The customers and the tax office both benefit from this.
  • When a dealer logs into the e-filing system, information such as pending documents and payments is shown. 
  • The online tax filing platform keeps records of any dealer, making it easy for the tax department to go back and check on these whenever necessary. This allows users to log in, correct their information, or submit on time, avoiding interest or penalty. This is helpful from the user’s perspective because they won’t have to repeatedly re-type any necessary papers.


Considering the aforementioned points, submitting VAT paperwork electronically can be a breeze. VAT, however, is under the jurisdiction of state governments, so you should be aware that there may be some minor differences in the laws and filing process from one state to the next.

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