This Content Was Last Updated on January 9, 2016 by


In amongst the flotsam, jetsam and detritus that emanates from HMRC I missed the announcement that from sometime after April 2010 businesses are going to have to file their vat returns online compulsorarily. I picked this up from a professional journal, but HMRCs web site is a little more oblique on the dates:

Anyway I decided to grasp the nettle for our own VAT returns, covering three entities. Heres the story:

It took me about 15 minutes to set up the first company for online vat, the others about 10 minutes each. You’ll need:

– your vat number

– postcode that vat returns are sent to

– the vat payment amount (box 5) for your last vat return submitted (I set up online in January to submit the October to December return, so for me it was the September quarters vat figures)

– the date you first registered for vat – I had this for two of the three companies, not the third – after some security checks HMRC VAT national enquiries gave me the date over the phone

Start at the “Do it online” section of HMRC web site, and get to VAT online. The first thing you need to do is register.

The registration confused me a little as it refers to registering on the Government Gateway, and as a firm we already have 2 or 3 identities there for PAYE, Self Assessment, Corporation Tax, etc. Anyway I put in my email address and a password and a user number came back – so far so good.

I subsequently found I had to go back over this process for each of the three businesses and get a new user number for each one – seemingly one email address can register many times but you get a different user number for each vat registration. Oh dear, why make it so complicated? Why not have a login linked using the vat number itself?

Anyway, once logged in you provide the security information above, and then have a chance to validate your email address. The system then takes you back to the start and although it doesn’t make it clear, you have to login again to file a return.

Selecting file a vat return tells you what periods are outstanding – for me December 2008 – but as a one off before you file that return suggests you complete a direct debit.

A direct debit is probably a good idea as it gives you extra time to pay and, in my case, circumvents the payment level restriction within my internet banking software that mean the vat payment had to be split in two. To illustrate the extra time, using the December quarter vat return:

– if you pay by cheque, its got to be there by 31/1

– if you pay electronically, eg internet banking, HMRC have to have cleared funds by 7/2

– if you pay by direct debit HMRC collect the direct debit from your account on 10/2

Having set the direct debit up, it was on to filing the vat return. You select the period – in most cases only one, the last quarter, will show, and enter box 1,2,4, 6,7,8 and 9 – for most businesses boxes 2, 8 and 9 are nils so in reality its 1, 4, 6 and 7. You don’t get a real time addition of the figures, but having entered them you ask the site to process the entries and boxes 3 and 5 are calculated for you.

If you’re happy you then press submit, wait a few seconds for an acknowledgement which you’re advised to print, and you’re done.

So, it took longer than filling in and posting three forms, but hopefully it will be quicker in future quarters when I don’t need to go through the setup process Although I suspect the process of logging on by itself will take longer than filling a bit of paper in, the benefit of a real time acknowledgement, and the fact that, well, we’ll have to do it sooner or later, all point towards grasping the nettle now. Oh, and just to encourage you, HMRC have stopped sending prepaid envelopes now – nice, huh?