To find out more, you can either watch our video or read about it below.
HMRC will record a default on your account if you miss your submission deadline or you fail to make a payment on time and you will enter a ‘surcharge period’ of 12 months. If you default for a second time within this 12 month period the surcharge period is extended for a further 12 months and you may have to pay a fine on top of the VAT you owe. This fine is based on a percentage of the VAT outstanding and increases every time you default.
Surcharges can be as high as 15% of your annual turnover. Therefore, don’t miss the deadlines!
If you deliberately understate or overclaim on your VAT return, HMRC can also charge you a penalty of 100% of your tax. Any errors to your VAT return must be reported to HMRC.
We hope you find this useful. If you have any queries, please get in touch. We’d love to help.