Half of small businesses make VAT return errors
Half of small businesses surveyed said they had made mistakes when sending in their VAT return and only a quarter were confident they had the figures correct despite spending more than an hour checking.
With the first deadline for online filing under Making Tax Digital for VAT falling this month, software specialist Intuit QuickBooks surveyed 500 UK small business owners in July and found they spend an average of 86 minutes checking their figures before sending their VAT return to HMRC.
Yet 51% have made mistakes when completing their VAT return and only a quarter (27%) say they feel confident they have filed their return correctly.
Of those who made errors with their VAT return, 27% overpaid and got money back from HMRC, compared to 18% of small businesses who received fines because of their mistakes, suggesting such errors can impact cashflow.
The research also indicated that after filing their return, a third (35%) of small business owners feel relief that it is out of the way, but 19% still worry they have missed something and 18% are anxious they have made a mistake.
Under Making Tax Digital, all businesses that are VAT registered and have a turnover of £85,000 or above had to register for online filing by April, with the first online returns for those that file quarterly due on 7 August.