How to file a VAT return through FreeAgent

This article explains how to file a VAT return directly to HMRC through FreeAgent.

Please note that you'll only be able to file a VAT return to HMRC once the VAT period has ended. For example, if the VAT period ends on 31st August, you won't be able to file the return until 1st September onwards.

You'll need to use FreeAgent's Making Tax Digital (MTD) connection in order to file your VAT return to HMRC through FreeAgent. If you haven't already done so, please connect your FreeAgent account to HMRC before following the steps outlined below.

1. Navigate to the VAT return

Navigate to the 'Taxes' tab at the top of the screen and select 'VAT' from the drop-down menu.

Next, select the VAT return that you would like to file.

To view a breakdown of the figures, select the 'Full Report' tab. Please note that this breakdown is for your and your accountant's reference only and is not sent to HMRC.

Once you've reviewed the figures, Select ‘File online with HMRC’ in the top-right to begin the filing process. 

Spend some time working through the following checklist, as seen on the filing page:

• Are your VAT registration and first VAT return dates correct?
• Have you chosen invoice or cash accounting as appropriate for this VAT return?
• Is your VAT Flat Rate Scheme setting correct? Remember this should be ‘Standard Scheme’ unless you’ve been accepted by HMRC to join the scheme.
• Have you entered and explained all your bank transactions up to and including the last day of this VAT Return period?
• Have you included any transactions for goods or services bought or sold to and from countries outside the UK correctly?
• Have you included and sent, or marked as sent, all your invoices that fall within this VAT return period?
• Have you entered all your out-of-pocket expenses for the VAT return period?

Amend any mistakes you come across and double-check your figures to make sure everything is correct before you file.

2. File the VAT return

When filing under Making Tax Digital (MTD) for VAT, you’ll have to make a declaration before making your submission.

Once you have made the declaration by ticking the box, select 'Submit VAT Return' and FreeAgent will send your return to HMRC using your Making Tax Digital (MTD) connection. It will tell you within a few seconds whether the submission was accepted or rejected.

FreeAgent will only send the total value in boxes 1-9 of your VAT return from the 'Preview' tab to HMRC and not a breakdown of the transactions from the 'Full Report' tab.

How to pay your VAT bill

Once you have filed your VAT return, the panel on the right-hand side of the screen will be updated with information on how to pay this VAT bill.  Follow the link to pay the bill.

If your VAT return is rejected

If you receive an error message when filing your VAT return, you may need to reconnect your FreeAgent account to HMRC. In this case, you will receive a message during the submission process informing you of the next steps.

If you receive a different error message, please see this article.

If you discover a mistake later

Once you’ve filed a return with HMRC, you can’t change it. FreeAgent will preserve your existing VAT return and put any corrections in your next open VAT return. Find out how to make corrections in a VAT locked period.