Knowledge Base Getting Started Frequently Asked Questions

How to check, edit and lock a VAT return

This article explains how to check, edit and lock each quarter's VAT return on FreeAgent. FreeAgent always calculates your VAT in real time from the invoices, bills, payments and expenses you enter.

Where do I find the VAT returns? 

Navigate to the ‘Taxes’ tab at the top of your screen and choose ‘VAT’ from the drop-down menu.


I can't see VAT on the Taxes menu.

If you haven't set your business as Registered for VAT, you won't see this option on the menu and you'll need to change the settings.

OK, I've selected VAT.

This brings up the VAT Statement of Account.

You can see here how much VAT has been due for each historic VAT return and how much you've paid. Bank payments that you explain as payments of VAT or VAT refunds will show on this screen, so that you can work out whether you owe anything to HMRC or whether they should be paying you.


I want to look at an individual return.

To navigate to each VAT return, use the drop-down menu here. You can choose from the VAT return for the quarter you're in at the moment, plus all the historic VAT returns.


Or you can select on a VAT return on this list to go to it.


This then brings up the VAT screen.


FreeAgent will warn you if there is a gap between the last set of data you entered and the end of the quarter. It will also warn you here if you have unexplained bank transactions on a business account, because you won't be able to file your VAT return until you have explained all the transactions in all your business bank accounts.


How to edit your VAT return settings and details

The details box shows you how this VAT return is being worked out. To change any of this information, select the 'Edit Details' button.


From here, you can then change various VAT settings.

Change the date the VAT period ends on

You can change the date the VAT period ends on. This will then roll forward and create the next return one, three or 12 months after the new date.

Please note that as part of HMRC guidelines, it’s not possible for your VAT period to be longer than 12 months.

Choose if your business is cash or invoice accounting

You can change whether your business is cash accounting for VAT or invoice accounting for VAT on this return. If you change the settings on a return, please be sure to apply the same changes to any future-dated returns that FreeAgent has already generated. When the settings have been changed on all these returns, FreeAgent will default to the new setting when it creates VAT returns in the future, so you shouldn't need to change the basis again.


Change your VAT Flat Rate Scheme settings

You can also change your VAT Flat Rate Scheme settings here. You may need to do this if you are moving from one type of Flat Rate Scheme to another, or if you are moving away from the Flat Rate Scheme to the standard VAT scheme (or vice versa). Again, this will usually be a permanent change so don't forget to check it has changed on future VAT returns too. If you want the change to your VAT flat rate settings to come into effect on a date that falls mid-way through a VAT quarter, please follow these instructions.


Adjust the numbers in boxes 6 and 7

You can adjust the numbers in boxes 6 and 7 of your VAT return. The process of changing the amounts in boxes 6 and 7 is the same, regardless if you’re on the Flat Rate Scheme or not. To learn more about adjusting these boxes, check out this article.


Add a fuel scale charge

And you can add the fuel scale charge if it applies. This will be if you've claimed input VAT on both your private and business motor expenses. Choose the CO2 band for your car. You can usually find this on the V5 registration form.


OK, my VAT return is finished.

Once you're confident that you've correctly entered all your transactions into FreeAgent for the VAT return, you can either file it online through FreeAgent, or, if you're using a different way to file your returns with HMRC, mark your FreeAgent VAT return as filed by selecting the Unfiled button and choosing Mark as filed.


I can't see the "Mark as filed" option.

That could mean:

  • You haven't finished explaining your bank transactions for the VAT quarter, or
  • Your accountant has restricted your access to your account. You'll need to speak to your accountant about this.

What happens when I mark my VAT return as filed?

How do I know what invoices, bills etc are on this VAT return?

Near the top of the screen you'll find a tab labelled Full Report.


Select this to see the transactions that make up this VAT return. So if you get a VAT inspection you can show this screen to the inspector.


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