The rule: VAT is collected on every sale, it is not a tax on profit. Roughly 1/6 of every customer payment belongs to HMRC. Returns MUST be filed through Making Tax Digital software (FreeAgent is free with a Mettle account, or QuickBooks/Xero). You cannot type figures into the HMRC website.
- Connect the business bank account to the software once, transactions flow in automatically.
- Photograph every receipt with the software phone app the day you get it.
- Enter sales monthly from the ops Monthly Accounts Export.
- At quarter end: open the pre-filled return, check it, submit, done. Set up the VAT direct debit in your HMRC account once and payment collects itself.
Keep records 6 years (digitally in the software counts). Quarters end Aug / Nov / Feb / May; return and payment are due the 7th of the second month after.
We hold names, addresses, dates of birth and driving licence photos, so the company must pay the ICO data protection fee. Register once at ico.org.uk → Pay the data protection fee (Tier 1, about £52 a year, take the direct debit so renewal is automatic). It is a fee, not an inspection.
Staying actually compliant: privacy policy on the site (done), collect only what is needed (done), and delete licence photos and documents once a hire is complete plus any insurer-required period, rather than keeping them forever.
Annual accounts (first ones due 11 Feb 2027, covering 11 May 2025 to 31 May 2026): the one job worth a one-off accountant fee (£300 to £600). A loss-making first year filed properly banks the loss against future Corporation Tax, worth real money later.
Corporation Tax: a loss year means £0 to pay but the CT600 return still gets filed (by 31 May 2027). The long first year is split into two periods, the software or accountant handles it.
Confirmation statement (by 24 May 2027): ten minutes on the Companies House site, £34, confirming company details are still right.
What are all my deadlines?
How do I submit a VAT return?
One-time setup: in the software, choose "connect to HMRC", log in with the company Government Gateway account, and grant access. That links the software to VAT number 512 0817 31.
Each quarter:
1. Check the quarter's bank transactions are all categorised (the software nags you about any that are not).
2. Make sure sales are in (from the ops Monthly Accounts Export) and receipts are photographed.
3. Open the return the software has pre-filled. It shows nine boxes; the two that matter are the VAT on your sales and the VAT you are reclaiming. Sanity-check: VAT on sales should be roughly 1/6 of the quarter's takings.
4. Press submit. The software files it with HMRC and shows a confirmation.
5. Payment: if the direct debit is set up, HMRC collects automatically about three working days after the deadline. Otherwise bank transfer, reference 512081731.
What are my VAT quarters, and when is the earliest I can submit?
You can submit from the day after the quarter ends, so the June-to-August return can be filed from 1 September, over a month before its 7 October deadline. Filing early is good practice (it is done while the quarter is fresh) and does NOT take your money early: a direct debit still collects at the normal time after the deadline.
How do I submit my Corporation Tax?
1. Annual accounts, prepared first (they are also what goes to Companies House by 11 Feb 2027).
2. The CT600 return, which takes the accounts figures and works out the tax, filed with HMRC by 31 May 2027. Payment, if any, is due earlier: about 9 months after year end (around 1 March 2027).
A loss-making year pays £0 but MUST still file, because a properly filed loss carries forward and cancels tax on future profits.
Honest recommendation for year one: have an accountant do accounts + CT600 as a one-off (£300 to £600). The first period is split into two returns (a quirk of long first years), and a correctly banked loss is worth more than the fee. From year two, software like FreeAgent can file both yourself.
What happens if I miss a VAT deadline?
What if I cannot afford to pay on time?
Do I charge VAT on security deposits?
What records do I need to keep, and for how long?
VAT registration number: 512 0817 31 (use 512081731 as the payment reference for VAT itself)
Aug 2026 penalty charge reference: XR006003640099
HMRC VAT bank account: sort 08 32 00, account 11963155, name HMRC VAT (public HMRC details, printed on every notice)
Struggling to pay on time: call HMRC on 0300 200 3835 BEFORE the deadline, a payment plan stops penalties growing.