Create a VAT Return

Most companies are registered for VAT and need to submit a return to HMRC once a month or quarterly. Doing this in Sage One is quick and easy. Once you’ve created the return, you can also record your payment or refund of VAT.

If you’d like to know more about how return calculates the values, please see our How the VAT Return calculates article. You should check the values on your VAT Return, if you believe any of the figures are incorrect you should check with your accountant.

If you haven’t already done so before you can submit your VAT Return, you must register with HMRC for online filing. For more information, please visit

To create a VAT Return and submit it to HMRC

  • 1. Reporting > VAT Returns.
  • 2. Create VAT Return > check and if necessary amend the from and to dates > Calculate.

If you have transactions from an earlier period which haven’t been included in a VAT Return, you’re asked if you want to include them. To view these transactions > View prior period transactions. To include these transactions on the current return > Yes, alternatively, if you don’t want to include them > No. If you click No, you won’t be prompted to include these transactions again on future returns.

  • 3. Check the values on the VAT Return are correct.

To check which transactions the VAT Return includes, click Detailed Report. The report shows the transactions included in each box on the return. If you want to know more about how the values in each box are calculated, please see our How the VAT Return calculates article.

  • 4. If you want to adjust any values on the return, click Adjust next to the relevant box > enter the amount you want to change the value by > enter a reason for the change > Save.
  • 5. To print the return, click Print > open your browser menu > choose to print or save the report.
  • 6. To print the detailed report > click Detailed Report > choose PDF.
  • 7. Once the file has downloaded, from the menu bar, choose the relevant report.

From within your browser, you can then print the report.

  • 8. Select one of the following options:
  • Submit online to the Government Gateway – If you want to submit directly to HMRC using Sage One, select this option. Check or enter your Government Gateway credentials. HMRC use these details to identify your company, therefore you must check they’re correct before continuing.
  • Submit to HMRC by other means – Select this option if you want to manually submit your VAT Return to HMRC through their website.
  • Save this return and submit it later – If you don’t want to complete the VAT Return yet, for example, because you want to check your values are correct, select this option. You can then return to the saved return at a later time to complete it and, if applicable submit it to HMRC using Sage One. For more information, see the section, To recalculate a VAT return.

If you choose to save the return for later, the transactions included in this return are marked as VAT reconciled and you can make limited changes to them.

You’ve successfully created your VAT Return. You can view the status of the return from the VAT Return list. Once you’re ready to do so, you can record payment or refund of VAT from HMRC as appropriate.

If for any reason your submission to HMRC wasn’t successful, from the VAT Return list, click the relevant return and the reason for the submission failing appears on the right-hand side. You should fix the error and try submitting again.

The most common reason for a VAT Return failing to submit is error code 1046 Authentication failure. This is because HMRC can’t recognise the credentials you used to submit your return. If this is the case, select Submit online to the Government Gateway > enter the correct details > try submitting again

The VAT Return status

The following table explains the different statuses that may appear against a VAT Return and what actions you can take for each one.

Status Recalculate Submit Delete Submit Later Pay
New Y Y N Y N
Submitted successfully to HMRC N N N N Y
Submitted Manually to HMRC N N N N Y
HMRC Submission Failed Y Y Y N N
Draft Y Y Y Y N
Waiting for HMRC N N N N N
Paid N N N N N
Part paid N N N N Y

To view further information about the status, click on the individual VAT Return from your VAT Return list.

This shows details of the current status, the date and time of the submission and which Sage One user made the submission. For example:

It also records the unique Correlation ID that the Government Gateway issues when you make a submission. This confirms that your submission was received and accepted by the Gateway. The Gateway then automatically forwards the submission to HMRC to be validated. If a submission fails, it gives the relevant HMRC error code.

To view an existing VAT Return

  • Reporting > VAT Returns > click the VAT Return you want to view.

From here you can print the return and view the detailed report to see how the values on the return were calculated. Depending on the status, you can also recalculate the values and submit it to HMRC.

To recalculate a VAT Return

Provided you haven’t submitted the VAT Return to HMRC, you can recalculate the values on the return. For example, because you had to check the values on the VAT Return so you saved it for later, or perhaps you’ve entered additional transactions you need to include on the return.

  • 1. Reporting > VAT Returns > click the VAT Return you want to amend.
  • 2. If you’ve entered additional transactions or have changed the dates of the return, click Calculate.
  • 3. Complete steps 3 to 6 in the section, To create a VAT Return.

To delete a VAT Return

If you need to delete a VAT Return, for example because you entered it in error and want to start again, you can do so as long as you haven’t submitted it to HMRC.

  • Reporting > VAT Returns > click the delete button next to the relevant VAT Return > Yes.

The VAT Return is deleted and if necessary you can calculate it again.

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