A Guide to VAT Return Deadlines & Penalties

Missing a VAT deadline costs more than it used to. HMRC now runs three separate penalty regimes at once, for late filing, late payment, and daily interest, and the late payment rates went up again in April 2025. Here's exactly when your returns are due, and what actually happens if you miss one.

Key Takeaways

• VAT returns are due one month and seven days after your VAT period ends, whatever your filing frequency.
• Late filing uses a points-based system: one point per late return, and a £200 fine once you hit your threshold, 2 points for annual filers, 4 for quarterly, 5 for monthly.
• Late payment penalties are separate from filing penalties, and were increased in April 2025, so they're worth understanding on their own terms.
• Using an accountant doesn't transfer your legal responsibility, a 2026 tribunal ruling confirmed that passively relying on someone else isn't a valid excuse for a late return.
• Contacting HMRC early if you're going to miss a deadline can genuinely reduce what you end up paying.

What Is a VAT Return?

A VAT return is a regular report VAT-registered businesses submit to HMRC, showing the VAT charged on sales and paid on purchases. HMRC uses it to work out what you owe, or what you can reclaim.

When Are VAT Returns Actually Due?

One month and seven days after the end of your VAT period, whether you file monthly, quarterly, or annually. If your VAT quarter ends 31 March, your return and any payment are due by 7 May.

Under Making Tax Digital, returns must be submitted electronically through compatible software rather than manually. A simple habit that helps: work out your submission date as soon as your VAT quarter ends, and set a reminder a few days before, rather than relying on memory alone.

How Do Late Filing Penalties Actually Work?

HMRC uses a points-based system, similar to penalty points on a driving licence. Every late return earns one point, and once you reach your threshold, a fixed £200 penalty follows, then another £200 for every subsequent late return.

Your threshold depends on how often you file:

• Annual filers: 2 points
• Quarterly filers: 4 points
• Monthly filers: 5 points

Points expire after a compliance period once you're filing on time again, roughly 24 months for annual filers, 12 for quarterly, and 6 for monthly, provided all your returns are up to date. Nil returns and repayment returns still count, so filing "nothing to report" late still earns a point.

What Are the Current Late Payment Penalties?

This is separate from the filing penalty above, and it's worth knowing the actual rates, since they increased significantly from 1 April 2025.

• 3% of the unpaid VAT if it's still outstanding at day 15
• A further 3% if still outstanding at day 30
• 10% a year, calculated daily, from day 31 onward until it's paid

On top of this, interest currently runs at 7.75% from the day the payment becomes overdue, calculated daily until it's settled. Together, this means even a short delay can add up faster than it used to, so it's genuinely worth prioritising payment over the return itself if you can only manage one on time.

What if My VAT Return Has Errors?

Submitting an inaccurate return can bring its own penalty, particularly if it results in underpaid VAT. How harshly HMRC treats it depends on whether the mistake was careless, deliberate, or concealed, so voluntarily correcting an error yourself, rather than waiting for HMRC to find it, generally leads to a lower penalty.

Does Using an Accountant Protect Me From These Penalties?

Not automatically. A 2026 tribunal decision (Luzha v HMRC) confirmed that passively relying on an accountant or agent, with no active oversight on your part, doesn't count as a reasonable excuse for a late return. The responsibility for filing on time stays with you, even if someone else is handling the actual submission.

This doesn't mean an accountant isn't worth having, just that it's worth staying engaged with your own deadlines rather than assuming it's entirely off your plate.

What Should I Do if I'm Going to Miss a Deadline?

Act quickly rather than waiting. Contact HMRC as soon as you realise, since a genuine reasonable excuse, serious illness or a system failure, for example, can sometimes be considered, though routine workload pressure generally won't qualify. Pay whatever you owe as soon as you can, even if the return itself is still outstanding, since this limits how much the late payment penalty grows. If you can't pay in full, ask about a payment plan rather than letting the balance sit unresolved.

FAQs

When is my VAT return actually due?

One month and seven days after your VAT accounting period ends, regardless of whether you file monthly, quarterly, or annually.

How much is the penalty for a late VAT return?

£200 once you reach your points threshold, 2 points for annual filers, 4 for quarterly, 5 for monthly, with another £200 for each late return after that.

What are the current VAT late payment penalty rates?

3% of the unpaid amount at day 15, a further 3% at day 30, then 10% a year from day 31, plus daily interest currently at 7.75%.

Does relying on my accountant protect me from late filing penalties?

No. A 2026 tribunal ruling confirmed that passively relying on an accountant, without active oversight, isn't accepted as a reasonable excuse.

Can HMRC waive a VAT penalty if I have a genuine excuse?

Yes, in some cases, such as serious illness or a system failure, though you'll need to show you acted as soon as you were able. Ordinary workload pressure doesn't qualify.

What should I do if I know I'm going to miss a VAT deadline?

Contact HMRC as early as possible, pay what you can even if the return is late, and ask about a payment plan if you can't clear the balance in full.

This article is for general information only and does not constitute tax advice. VAT penalty rates and thresholds can change, so it's worth checking current guidance on GOV.UK or speaking to a qualified accountant.