VAT Return Checklist
A VAT return checklist for small businesses: reconcile output and input tax, check reverse charge and invoices, then file and pay on time. Works for GST too.
- Typical schedule quarterly
- The checklist 5 sections, 19 items
- Variables
{{period}}
Use this checklist for each VAT, GST or sales tax return, whether you file monthly, quarterly or once a year. It is written for small businesses that prepare the return themselves or hand a reviewed file to their tax adviser. Run it after the books for the period are closed, so the return is based on final numbers.
Who owns it
The bookkeeper or finance lead prepares the return. Someone else, such as the finance lead, a founder or the external adviser, reviews it before submission. The person who submits should check that the payment is scheduled at the same time, because a filed return with a missed payment still causes penalties and interest.
Common pitfalls
- Filing from the tax report without reconciling. The VAT report in your software only reflects what was coded. Reconcile it to the VAT control accounts in the ledger first.
- Wrong tax codes on foreign purchases. Software subscriptions and services bought from abroad often need the reverse charge. They are easy to post as ordinary expenses without VAT.
- Reclaiming input tax without a valid invoice. Receipts that lack the supplier's VAT number or the required details may not support a deduction.
- Credit notes and bad debts forgotten. Both change the amounts due and are often posted late.
Schedule the run for each filing period so the deadline is never a surprise. Rules, rates and deadlines differ by country and change often. Adapt this to your jurisdiction; it is a practical checklist, not tax advice.
The checklist: VAT return {{period}}
Prepare the data
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Confirm all sales and purchase invoices for
{{period}}are posted -
Confirm the bank and payment provider accounts for
{{period}}are reconciled -
Run the VAT or sales tax report for
{{period}}from the accounting system
Check output tax
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Reconcile output tax on the report to the output VAT control account in the ledger
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Check that sales to other countries use the correct tax treatment
For example, zero-rated exports, reverse-charge B2B services, or local VAT for distance sales.
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Check that credit notes issued in
{{period}}reduce output tax -
Review sales posted with no tax or a reduced rate, and confirm each one is justified
Check input tax
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Reconcile input tax on the report to the input VAT control account in the ledger
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Spot-check large purchases for a valid invoice with the details your rules require
Typically supplier name, VAT number, date, net amount, rate and tax amount.
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Apply the reverse charge to services and software bought from foreign suppliers
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Exclude input tax that is not deductible, such as private use or blocked expense categories
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Adjust input tax for supplier invoices you have not paid within the allowed time optional
Review and file
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Compare the return to the same period last year and explain large changes
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Apply any corrections from previous periods as your rules allow
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Second person reviews the return and the reconciliation
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Submit the return for
{{period}}before the deadline and save the submission receipt -
Schedule or make the VAT payment, or record the expected refund
Record
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Post the VAT settlement so the control accounts clear to the amount paid or refunded
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File the return, reconciliation and receipt in the tax archive for
{{period}}
Checklist as Markdown
Frequently asked questions
How do I prepare a VAT return?
Make sure all invoices for the period are posted and the bank is reconciled. Then run the VAT report, reconcile it to the VAT accounts in your ledger and check the unusual items, such as foreign transactions, credit notes and zero-rated sales. Have someone review it, then file and pay before the deadline.
What are the most common VAT return mistakes?
Missing the reverse charge on services bought from abroad, reclaiming VAT without a valid invoice, using the wrong rate, and forgetting credit notes. Another common mistake is filing straight from the software report without reconciling it to the ledger, so coding errors pass straight into the return.
Does this checklist work for US sales tax or GST?
Yes, the structure works for any consumption tax: reconcile, check outgoing tax, check reclaimable tax, review and file. US sales tax has no input tax reclaim in the same way, so skip that section and check nexus and the tax rates per state instead. Your adviser can confirm the rules for each place you file.
Updated