VAT repayments (2024)

Usually, if you’ve charged your customers less VAT than you’ve paid on your purchases, HM Revenue and Customs (HMRC) repay you the difference.

When you complete the boxes on your VAT Return, the information you enter will show you the:

• total amount of VAT charged - Box 3
• total amount of VAT paid - Box 4

You’re due a repayment if the figure in Box 3 is less than the figure in Box 4.

How much you’re repaid is the figure shown in Box 5 of your VAT Return.

How long it takes

Repayments are usually made within 30 days of HMRC getting your VAT Return. Contact HMRC if you have not heard anything after 30 days.

Your repayment will go direct to your bank account if HMRC has your bank details. Otherwise HMRC will send you a cheque (also known as a ‘payable order’). You can change the details that HMRC uses to make your repayment.

Track a VAT repayment

You can track a VAT repayment online.

If your accounting period started on or before 31 December 2022

You may get compensation (known as a ‘repayment supplement’) if HMRC takes longer than 30 days to approve your repayment.

The 30 days start on the day HMRC gets your VAT return and ends on the day they approve your repayment, not the day you get it.

HMRC does not count days taken to check your return is accurate and legitimate, and to correct any errors or omissions, as part of this 30-day period.

The repayment supplement is £50 or 5% of your repayment - whichever is the higher amount.

If your return is received before the end of the accounting period it’s for, the 30 days will start at the end of the period.

You will not get a repayment supplement if, for example:

• HMRC receives your VAT Return after your payment deadline
• you made errors on your return that reduce your claim by more than 5% or £250 (whichever is higher)
• you have earlier returns missing at the time your current return is received by HMRC

If your accounting period started on or after 1 January 2023

If HMRC is late in paying you, you may be entitled to repayment interest on any VAT that you are owed.

Repayment interest is paid at the Bank of England base rate minus 1%, with a minimum rate of 0.5%.

Repayments to an overseas bank account

You can only get VAT repayments paid into an overseas bank account if your company:

• does not have a UK bank account (and you’re unable to get one)
• does not have a UK address

For HMRC to make a payment into your overseas bank account, it must be:

• in the name of the company owed a repayment
• associated with a named business owner or an authorised person with a Government Gateway ID
• able to accept repayments in pounds sterling

You must fill in a form to give details of your overseas bank account before HMRC can transfer any VAT repayments. All VAT repayments will then be sent to this bank account.

You can also use the form to change uncashed cheques into electronic payments to your bank account or update your bank details.

You’ll need a Government Gateway user ID and password to submit your information. If you do not have a user ID, you can create one the first time you sign in.

If you need a new cheque or you want to be paid in a different way

You can write to HMRC Payments to ask them to:

• send a replacement cheque if yours is lost or out of date
• send the repayment to the bank account stored on your business tax account
• send the repayment somewhere else because you are no longer VAT registered
• use the repayment to pay another tax

You must return cheques that are out of date or you’re not going to use.