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Late returns: The four-year cap

Shared from Tax Insider: Late returns: The four-year cap
By Andrew Needham, November 2023

Andrew Needham looks at the submission of late VAT returns and the four-year cap. 

VAT returns and payments should be submitted to HMRC no later than seven days after the end of the month following the end of the VAT period. If the return and/or payment are submitted late, it can result in the business entering either or both of the penalty regimes for late payments or late returns.  

If a business does not have the funds to pay its VAT liability, it should still send its return in on time and contact HMRC’s business support line and arrange a ‘time to pay’ agreement with them (normally 3-6 months), which will avoid a penalty. It is therefore important to send in the return and agree a time to pay arrangement with HMRC rather than ignore the problem and hope it will go away – it will not! 

If a business receives a penalty for a late return or payment, it can appeal the penalty if it has a

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