How to Submit VAT Returns Online to HMRC

Why do VAT returns need to be filed digitally?

Under Making Tax Digital for VAT, HMRC requires all VAT-registered businesses to keep digital records and submit VAT returns using software connected to HMRC's API. This applies to all 2.2 million VAT-registered businesses in the UK, regardless of size or turnover.

The digital requirement was designed to reduce errors — HMRC estimates that mistakes on VAT returns cost the Exchequer over £3 billion per year. Software that calculates figures automatically and submits them digitally eliminates many of these transcription errors.

For businesses, the switch to digital filing is actually simpler once set up. Instead of logging into the HMRC website, entering 9 boxes manually, and hoping you haven't transposed any digits, your software calculates the figures from your records and submits them in one click.

VAT return boxes 1-9 explained

Every VAT return has 9 boxes. Here's what each one means:

MTDFile calculates Box 3 and Box 5 automatically. You enter (or import) your sales and purchase figures, and the software computes the totals. Before submitting, you review all 9 boxes on screen and confirm they're correct.

How to submit your VAT return with MTDFile

1. 1
   Connect to HMRC

   Log in to MTDFile and click “Connect to HMRC”. You'll be redirected to the Government Gateway login page. Enter your credentials and grant MTDFile permission to submit VAT returns on your behalf. This only needs to be done once.

2. 2
   View your obligations

   MTDFile pulls your open VAT obligations directly from HMRC. You'll see which periods are outstanding, when they're due, and whether any are overdue.

3. 3
   Enter your figures

   Enter your Box 1-9 values. If you keep your records in MTDFile, these are calculated automatically. Otherwise, enter them from your bookkeeping records or spreadsheet.

4. 4
   Review and submit

   Review all 9 boxes on the summary screen. When you're satisfied, tick the declaration checkbox and click “Submit to HMRC”. MTDFile sends your return directly to HMRC via their official API and shows you a confirmation with the receipt ID.

5. 5
   Done — pay any VAT owed

   Once submitted, you'll receive a confirmation. If Box 5 shows you owe VAT, pay HMRC by the deadline. If HMRC owes you a refund, it will be processed automatically.

VAT schemes supported

MTDFile supports all standard VAT schemes:

• Standard VAT accounting — Record VAT on invoice date, the most common scheme
• Cash accounting — Record VAT when payment is received or made, useful for cashflow
• Flat rate scheme — Pay a fixed percentage of turnover, simpler for small businesses
• Annual accounting — Submit one return per year with interim payments

Select your scheme during onboarding and MTDFile adjusts its calculations accordingly. You can switch schemes at any time (in line with HMRC's rules).

VAT return deadlines

Most VAT-registered businesses file quarterly. The deadline is one calendar month and 7 days after the end of each VAT period. For the standard quarterly schedule:

Your actual VAT periods may differ — HMRC assigns these when you register. MTDFile shows your exact obligation dates pulled directly from HMRC.

Common VAT return mistakes to avoid

• Transposing figures: Entering £5,230 instead of £5,320. Software like MTDFile calculates from your records, eliminating manual transcription errors.
• Missing the deadline: Even by one day. HMRC gives you a penalty point for each late submission. MTDFile sends deadline reminders so you never miss one.
• Including exempt supplies in Box 6: Only taxable supplies go in Box 6. Exempt income (like residential rent) should not be included.
• Forgetting reverse charges: If you buy services from outside the UK, you may need to account for reverse charge VAT in Box 1 and reclaim it in Box 4.
• Not keeping digital records: Even if you submit correctly, HMRC can penalise you for not maintaining proper digital records. MTDFile stores all your records digitally by default.