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Work out your VAT penalty
An estimate based on GOV.UK guidance on VAT penalty points and late payment penalties.
Late return penalties: how points work
| How often you file | Points threshold | At the threshold |
|---|---|---|
| Annually | 2 points | £200 penalty, then £200 for each further late return |
| Quarterly | 4 points | £200 penalty, then £200 for each further late return |
| Monthly | 5 points | £200 penalty, then £200 for each further late return |
- Every late return earns a point, including nil returns and repayment returns.
- Points usually expire after 24 months. Once you are at the threshold, they only reset after a period of filing on time.
For the full rules on points, see VAT penalty points explained.
Late payment penalties
| When you pay | Penalty |
|---|---|
| Within 15 days of the due date | No penalty, but interest is charged |
| Between 16 and 30 days late | 3% of the VAT unpaid at day 15 |
| 31 days or more late | 3% of the VAT unpaid at day 15, plus 3% of the VAT still unpaid at day 30, plus a daily penalty at 10% a year from day 31 |
If you cannot pay in full, contact HMRC before the deadline. Agreeing a Time to Pay arrangement can stop further late payment penalties building up.
Filing mistakes that lead to penalties
- Filing late because of last-minute problems, such as a lost HMRC connection or a rejected return.
- Filing the wrong period, leaving the right one outstanding and late.
- Retyping figures, which breaks the digital link MTD requires and invites typing errors.
- Box errors, such as Box 3 not matching Boxes 1 and 2, or Box 5 worked out wrongly.
- Reclaiming VAT without a valid VAT invoice, or on costs you cannot reclaim, such as most business entertainment.
- Assuming a nil return can wait. A late nil return still earns a point.
If you find a mistake after filing
- A submitted return cannot be changed. Correct net errors up to £10,000, or up to 1% of Box 6 with a £50,000 limit, on your next return.
- Report larger errors, or deliberate ones, to HMRC separately.
- Telling HMRC about a careless error before it finds it can reduce or remove an inaccuracy penalty.
Due dates from HMRC and reminders before each one, from £5 a month
Swift VAT Pro shows your VAT periods and due dates and emails you 4 days and 3 days before each deadline, so returns are not late.
- Connect to HMRC on HMRC's own page with your Government Gateway sign-in. We never see that password.
- See your VAT periods, due dates, amounts owed and payments, read from HMRC.
- Upload your nine box totals as a CSV. Box 3 and Box 5 are worked out and every box is checked.
- Submit and keep HMRC's receipt. Reminder emails arrive before each due date.
No card needed · From £5 a month · Plans for up to 100 businesses · Filing through HMRC's MTD service since 2019
Final thoughts
Most VAT penalties come from timing, not tax. Know your due dates, file a few days early, pay by a method that arrives in time, and check your figures before you submit.
Disclaimer: This guide gives general information, not advice for your business. If you are unsure how the rules apply to you, speak to an accountant or contact HMRC.
Frequently asked questions
Checked against HMRC guidance on VAT penalty points, late payment penalties and late payment interest, and VAT Notice 700/45. November 2026.
What is the penalty for paying VAT late?
What is the penalty for a late VAT return?
Do nil VAT returns get penalty points if late?
Is interest charged on late VAT?
What if I cannot pay my VAT bill on time?
Due dates from HMRC and reminders before each one, from £5 a month.
Swift VAT Pro files your return to HMRC from the spreadsheet you already keep. From £5 a month.
No card needed · 2,900+ VAT returns filed since 2019