If your VAT quarter ended on 31 March, your return and payment were due five days ago. Miss the next one and HMRC will start putting points on your VAT record - the kind that turn into £200 fines once the meter runs out. The system is now four years old, but most small businesses still treat it like a guessing game. Here is what the 2026-27 calendar actually looks like, and what HMRC will do if you slip.
TL;DR: UK VAT-registered businesses must file quarterly returns through MTD-compatible software, due one calendar month and seven days after each quarter ends. Late submissions earn penalty points; hit four points on a quarterly cycle and every late return after that costs £200. The VAT registration threshold stays at £90,000 through April 2027. Late payment penalties start at 2% if you pay more than 15 days after the due date.
When Are the UK Quarterly VAT Return Deadlines for 2026-27?
VAT returns are due one calendar month plus seven days after the end of your quarter. For businesses on the standard March-June-September-December cycle, that gives four key dates each year (GOV.UK, 2026):
- Quarter ending 31 March 2026 - return and payment due 7 May 2026
- Quarter ending 30 June 2026 - due 7 August 2026
- Quarter ending 30 September 2026 - due 7 November 2026
- Quarter ending 31 December 2026 - due 7 February 2027
Your VAT registration certificate confirms which "stagger group" you sit in, so don't assume the calendar above applies if you registered mid-year. Some businesses run April-July-October-January or May-August-November-February cycles instead. The seven-day rule is the same; only the start month moves.
Direct Debit payers get an extra three working days for the cash to leave their account, but the return itself must still land with HMRC by the seven-day deadline.
What Software Counts as MTD-Compatible?
Any software that connects to HMRC's API and submits the nine VAT return boxes digitally counts as compatible. HMRC publishes a searchable list of recognised products on GOV.UK and updates it as new tools pass certification (GOV.UK, 2026). The list includes:
- Full accounting platforms - Xero, QuickBooks, Sage Business Cloud, FreeAgent, Zoho Books
- Bridging software for spreadsheet users - 123 Sheets, VitalTax, Easy MTD VAT, MyTaxDigital (free for sole traders)
- Sector tools - Hammock for landlords, Tradify for trades
The point HMRC cares about is the digital link. You cannot manually copy figures from one system into another at any point between your source record and the final submission. If you use a spreadsheet to total your VAT, the spreadsheet has to feed into bridging software automatically - through a formula link, an import, or an API - not through a copy-paste.
In our experience, this is where small businesses still trip up most often. They run Xero for invoices but keep a separate spreadsheet for cash purchases, then type the cash totals into Xero before filing. That manual step breaks the digital chain and, in theory, makes the return non-compliant.
How Does the VAT Penalty Points System Work?
Since 1 January 2023, HMRC has scored late VAT returns rather than fining each one separately. You get one point for every return filed after the deadline. Once you hit a threshold, the next late return - and every one after that - costs £200 (GOV.UK, 2026).
The threshold depends on how often you file:
- Annual returns - 2 points
- Quarterly returns - 4 points
- Monthly returns - 5 points
Most small businesses sit on the quarterly cycle, so the practical line is four. Submit four returns late in any rolling period, and the fifth onwards triggers the £200 charge (Sleek UK, 2026).
Points expire on a 24-month rolling clock, but only if you stay below the threshold. Once you hit the cap, the only way to clear your record is to file every return on time for a full 12 months and bring all outstanding returns up to date for the previous two years.
What Happens If You Pay VAT Late?
Late payment penalties run on a separate track from the points system. They have applied at the current rates since 1 April 2025 and remained unchanged through 2026 (Price Bailey, 2026):
- 1 to 15 days late - no penalty if you pay or agree a Time to Pay arrangement
- 16 to 30 days late - 2% of the outstanding amount
- 31+ days late - a further 2%, plus daily penalties of 4% per annum on the unpaid balance
Interest also runs from day one at the Bank of England base rate plus 4%. With base rate held at 3.75% since December 2025, the late payment interest rate sits at 7.75% on top of the percentage penalties (GOV.UK, 2026).
One question clients always ask: if I file the return on time but cannot pay the bill, do I avoid the points? Yes. The points system tracks submissions, not payments. Filing late but paying on time still costs you a point. Filing on time but paying late costs interest and percentage penalties but no point.
Do You Still Need to Register for VAT at £90,000?
The compulsory registration threshold remains £90,000 of taxable turnover in any rolling 12-month period and stays there through April 2027 according to the Office for Budget Responsibility (House of Commons Library, 2025). The deregistration threshold stays at £88,000.
"Rolling" is the word that catches people out. It does not mean your tax year or the calendar year. It means the last 12 months from today, recalculated each month. If your turnover crossed £90,000 at any point in the past year, you should already be registered.
You must notify HMRC within 30 days of the end of the month you crossed the threshold. Effective registration is the first day of the following month. If you knew or had reason to believe your turnover would cross £90,000 in the next 30 days alone, you must register before that period ends.
Voluntary registration below £90,000 is also an option and worth considering if your customers are mostly VAT-registered businesses. We have walked clients through both decisions in our advisory work on sole trader vs limited company structures.
What If You Need More Time?
HMRC offers Time to Pay arrangements for businesses that cannot meet a VAT bill on time. You can set one up online for VAT debts under £100,000 if you have filed all returns and have no other active arrangements (GOV.UK, 2026). Agreeing a Time to Pay before the 15-day mark stops the late payment penalty clock.
The arrangement needs to be agreed - not just requested - before day 16, so do not wait until the last moment. Interest still applies, but the percentage penalties are paused while you keep to the schedule.
What we see most often is businesses missing the deadline by accident because the return was sitting in draft inside their software, not filed. Submission is a one-click action at the end of the workflow; "saved" is not the same as "sent." If you are using a new accounting tool this quarter, check the audit trail after every filing.
Frequently Asked Questions
Are quarterly VAT returns the same as MTD for Income Tax?
No. MTD for VAT has applied to all VAT-registered businesses since 1 April 2022. MTD for Income Tax Self Assessment (MTD ITSA) is a separate programme that started on 6 April 2026 for sole traders and landlords with income above £50,000. Our guide to MTD changes in April 2026 covers the income tax side.
Can I still use spreadsheets to calculate my VAT?
Yes, as long as bridging software handles the actual submission to HMRC and there is a digital link between the spreadsheet and the bridge. You cannot type figures from a spreadsheet into a separate filing tool - that breaks the digital link rule.
What is the VAT return deadline if my quarter does not end in March, June, September, or December?
Add one calendar month and seven days to the last day of your quarter, regardless of which month it ends in. If your quarter ends 30 April, your return is due 7 June. Your VAT registration certificate confirms the exact dates for your stagger group.
What if I forgot to register for VAT after crossing the threshold?
Register as soon as you realise. HMRC backdates registration to the date you should have been registered, which means you owe VAT on sales from that date even if you did not charge it. Interest applies, and a failure-to-notify penalty of up to 100% of the unpaid VAT may follow. We cover the broader penalty structure in our HMRC late payment penalties guide.
How long do I have to keep VAT records under MTD?
Six years from the end of the relevant VAT period. Records must be kept digitally and include all sales and purchase invoices, receipts, and the workings behind your nine-box return. Paper backups are allowed but cannot replace the digital records.
If you are juggling quarterly VAT alongside MTD ITSA, payroll, and corporation tax, the calendar gets crowded fast. Talk to our team - we run quarterly VAT compliance for UK clients on Xero, QuickBooks, and FreeAgent, and we will flag any deadline before HMRC does.