Explore the Best Free VAT Return Software for Your Business

best free vat return software

As a business owner, you’re likely familiar with the tedious process of filing VAT returns. It can be time-consuming and prone to error, especially if you’re relying on manual methods such as spreadsheets. Fortunately, there’s a better way. VAT return software can streamline the process, saving you time and reducing the risk of mistakes.

But with so many options available in the market, it can be challenging to choose the right one for your business. That’s why we’ve compiled a list of the best free VAT return software options to help you make an informed decision.

Key Takeaways

  • Using free VAT return software can save you time and reduce the risk of errors in the filing process.
  • There are various options available in the market, so it’s essential to choose the one that’s right for your business needs.
  • Factors to consider include user-friendliness, data security, customer support, and additional features.

Understanding VAT Returns and the Need for Software Solutions

If your business is registered for VAT, you know how time-consuming and complex the process of filing VAT returns can be. That’s where online VAT return software comes in to make things easier for you. With the right software solution, you can automate the entire process, saving time and reducing errors.

One of the most significant benefits of using VAT return software is that it enables you to file your returns online, ensuring that you meet the HMRC’s requirements accurately and on time. This means you don’t have to worry about sending paper forms or missing deadlines, which could result in penalties.

Features to Look for in Online VAT Return Software

When choosing online VAT return software, you should look for one that offers a user-friendly interface, comprehensive VAT return filing features, and real-time updates. Additionally, a VAT return calculator can be very useful in helping you calculate your VAT accurately and quickly.

Moreover, you should choose a software solution that integrates seamlessly with other accounting software you may be using, ensuring that your business operations are streamlined. Cloud-based VAT return software solutions provide the added advantage of being accessible from anywhere, allowing you to file your returns from any device with an internet connection.

To ensure your financial information is secure, look for software solutions that offer data encryption and regular backups. This will not only protect your business’ sensitive financial information but also give you peace of mind.

Top Free VAT Return Software Options

Now that you understand the benefits of using VAT return software and the features to look for, it’s time to explore the best free options available in the market. The following cloud-based VAT return software solutions offer excellent functionalities, ease of use, and compatibility with various business needs.

Software Features
HMRC’s Online Service – Free to use
– Easy-to-navigate platform
– Direct submission to HMRC
– Basic calculations and error checks
Clear Books – Free for up to 10 transactions per month
– User-friendly interface
– Automated data import and categorization
– Direct submission to HMRC
FreeAgent – Free for sole traders with less than £10,000 annual turnover
– Easy-to-use platform
– Automated bank feeds and invoicing
– Direct submission to HMRC
GnuCash – Free and open-source
– Supports multiple currencies
– Advanced reporting and budgeting features
– Direct submission to HMRC

These free VAT return software options offer businesses the chance to accurately and efficiently file their VAT returns without the added expense of paid software solutions. Additionally, cloud-based software solutions allow users to access their data from anywhere, making it easier to stay on top of their finances.

HMRC VAT Return and Filing Deadlines

If you are registered for VAT in the UK, it is essential to file your VAT return and make payment to HM Revenue & Customs (HMRC) by the deadline. Failure to do so can result in penalties and interest charges. The frequency of your filing will depend on the size and turnover of your business. Larger businesses usually file quarterly, while smaller businesses may file annually.

To be safe, it is wise to check the deadline for your specific VAT return period and set a reminder to ensure timely filing. The deadline is usually one calendar month and seven days after the end of the VAT return period. For example, if your VAT return period ends on 31 March, the deadline for filing and payment is 7 May.

Using HMRC’s online VAT return service can make the filing process faster and more efficient. Many VAT return software solutions also integrate with HMRC’s system, simplifying the process and reducing errors.

Benefits of Using Free VAT Return Software

Using free VAT return software can offer immense benefits for your business. These software solutions can help you streamline your tax filing process, save time, reduce errors, and improve overall financial efficiency. Here are some key advantages of using free VAT return software:

  • Automation: VAT return software can automate the entire filing process, from data entry to submission to HMRC. This means you can save time and reduce the risk of errors that come with manual filing.
  • Accuracy: VAT return software can perform complex calculations and ensure accurate reporting. It can also flag any potential errors or inconsistencies that need to be corrected before filing.
  • Cost-effective: Free VAT return software is an affordable option for businesses that want to manage their finances effectively without incurring additional costs. These software solutions can help you save money on professional tax filing services.
  • User-friendly: Free VAT return software often comes with a user-friendly interface, making it easy to navigate and operate even for those with limited experience in tax filing.

Overall, using free VAT return software can help you manage your finances more efficiently, reduce the risk of errors, and stay compliant with HMRC requirements.

Factors to Consider When Choosing VAT Return Software

Now that you understand the benefits of using free VAT return software, it’s important to consider the factors that will help you choose the best option for your business needs. Here are some key considerations to keep in mind:


Look for software that is intuitive and easy to use, with a clear interface and navigation. A good VAT return software should simplify the filing process, not make it more complicated. Take advantage of any free trials or demos to test the software before committing to it.

Data Security

Make sure the software you choose has robust security measures in place to protect your data. This is especially important when dealing with sensitive financial information. Look for software that uses encryption and has regular backup processes in place to safeguard your data.

Additional Features

Consider any additional features that might be beneficial for your business. For example, some VAT return software has the ability to handle multiple tax rates or can integrate with other financial software you’re using. Look for software that can scale with your business as you grow.

Customer Support

Choose a software provider that offers strong customer support, with prompt responses and clear communication. Check the provider’s website for contact information and hours of availability. Look for software that offers user guides, tutorials, or a knowledge base to help troubleshoot issues.


Ensure that the software you choose is compatible with your existing systems and software. This will prevent any issues with data transfer or integration. Check for system requirements and supported file formats before settling on a VAT return software.

By keeping these factors in mind and thoroughly researching your options, you can find the best free VAT return software to meet your business needs. Don’t settle for a subpar solution that could hinder your financial efficiency; choose the best free VAT return software that fits your budget and business goals.

Implementing VAT Return Software: Step-by-Step Guide

Switching to a new system for VAT return filing can seem daunting, but the process can be smooth if you follow the right steps. Here’s a step-by-step guide to implementing VAT return software:

  1. Choose the right software: Before you start, choose the best free VAT return software that matches your business needs. Look for features such as automated calculations, data validation, and support for different VAT schemes.
  2. Set up your account: Sign up for the software and create your account. Follow the software’s instructions to enter your business details and VAT registration number. Make sure to verify your email address and other contact details to ensure seamless communication.
  3. Connect your accounts: Connect your business bank account and other financial accounts to the software. This will allow the software to automatically retrieve and categorise transaction data, saving you time and reducing the risk of errors.
  4. Configure your settings: Personalise your software settings to match your business preferences. For example, set up your VAT scheme, payment frequency, and invoicing details.
  5. Enter your data: Input your VAT data into the software, making sure it is accurate and up-to-date. The software will automatically calculate the amount of VAT due and generate your VAT return form.
  6. Review your return: Double-check your VAT return form for accuracy and completeness. Make any necessary adjustments or corrections before submitting.
  7. Submit your return: Submit your VAT return electronically to HMRC using the software. This will save you time, as you won’t need to manually enter data onto the HMRC website.
  8. Keep records: Finally, keep a record of your VAT returns and related documents for at least 6 years. This will ensure compliance with HMRC requirements and allow for easy retrieval in case of an audit.

By following these steps, you can streamline your VAT return filing process and ensure compliance with HMRC requirements. With the right free VAT return software, you can simplify your finances and focus on growing your business.

Excel VAT Return Template: A Viable Option?

While dedicated VAT return software can provide numerous benefits for businesses, you may be wondering if using an Excel VAT return template is a viable alternative. While spreadsheets can be useful for recording financial data, relying solely on an Excel VAT return template can have limitations and potential risks.

One key disadvantage of using an Excel VAT return template is the risk of errors. It can be easy to make mistakes when manually entering data, which can lead to inaccurate calculations and potentially costly penalties from HMRC. Additionally, spreadsheets lack the automation and validation features of dedicated software, which can increase the risk of errors.

Another limitation of using an Excel VAT return template is the lack of integration with other financial systems. VAT return software can often integrate with other bookkeeping tools, such as accounting software or invoicing platforms, which can streamline the entire financial process and enhance overall efficiency.

However, an Excel VAT return template can be a viable option for small businesses with very basic VAT requirements. If your business has a low volume of transactions and a simple VAT return to file, a spreadsheet may be sufficient. Just be sure to carefully review and double-check all calculations to avoid errors.

In summary, while an Excel VAT return template may be a viable option for some businesses, it has limitations and potential risks. For businesses with more complex requirements, dedicated VAT return software can provide numerous benefits, including increased accuracy and efficiency.


Choosing the best free VAT return software for your business is crucial for ensuring compliance with tax regulations, improving financial efficiency, and avoiding penalties. Throughout this article, we have explored the benefits of using online VAT return software and highlighted the top free options available in the market.

By streamlining your VAT return filing process, you can save time, reduce errors, and improve accuracy. Cloud-based VAT return software solutions offer additional advantages, such as accessibility and automatic updates.

When choosing the best free VAT return software for your business, consider factors such as user-friendliness, data security, customer support, and additional features. By following our step-by-step guide, you can implement the software seamlessly and accurately file your HMRC VAT returns.

While Excel VAT return templates can be a viable option, they come with limitations and potential risks. It’s important to weigh the pros and cons before relying solely on spreadsheets for your VAT return filing.

Ultimately, by selecting the best free VAT return software for your business needs, you can streamline your financial processes and ensure compliance with tax regulations. Don’t hesitate to explore our recommended options and take advantage of the benefits offered by these software solutions.


Q: What is VAT return software?

A: VAT return software is a digital tool that helps businesses manage and streamline their Value Added Tax (VAT) return filing process. It automates calculations, tracks VAT liabilities and payments, and generates accurate reports for submission to tax authorities.

Q: Why should businesses use VAT return software?

A: Businesses should use VAT return software to simplify the complex process of VAT return filing. It helps in reducing errors, saving time, improving accuracy, and ensuring compliance with tax regulations. Additionally, VAT return software provides real-time visibility into VAT liabilities and payments, enabling businesses to make informed financial decisions.

Q: Is there free VAT return software available?

A: Yes, there are free VAT return software options available in the market. These software solutions offer basic features for small businesses and freelancers to manage their VAT return filing process without incurring any additional costs.

Q: What features should I look for in VAT return software?

A: When choosing VAT return software, consider features such as automatic calculation of VAT liabilities, real-time data synchronization, customizable VAT reports, data security measures, user-friendly interface, and compatibility with your accounting software.

Q: Can I use cloud-based VAT return software?

A: Yes, there are cloud-based VAT return software solutions available. These cloud-based solutions offer the advantage of accessibility from anywhere, automatic software updates, and secure data storage. They are especially beneficial for businesses with multiple locations or remote teams.

Q: What are the HMRC VAT return filing deadlines?

A: The HMRC VAT return filing deadlines depend on your VAT return period. Generally, the deadline for submitting VAT returns and making payments is one month and seven days after the end of the VAT return period. Make sure to check the specific deadlines for your VAT return period to avoid penalties.

Q: What are the benefits of using free VAT return software?

A: The benefits of using free VAT return software include time savings, reduced errors in calculations, improved accuracy in VAT return filings, enhanced financial efficiency, and a simplified process for managing VAT liabilities and payments.

Q: What factors should I consider when choosing VAT return software?

A: When choosing VAT return software, consider factors such as user-friendliness, data security measures, availability of customer support, compatibility with your accounting software, additional features like real-time data synchronization, and the scalability of the software to cater to your business needs.

Q: How can I implement VAT return software?

A: Implementing VAT return software involves steps such as selecting the right software for your business needs, setting up the software with your company information and VAT details, importing or adding your sales and purchase data, reconciling transactions, generating VAT return reports, and submitting the completed VAT return to HMRC.

Q: Is an Excel VAT return template a viable option?

A: While an Excel VAT return template can be used as a basic option for small businesses, it has limitations in terms of automation, scalability, and potential errors in manual calculations. Dedicated VAT return software offers more advanced features and ensures accurate and efficient VAT return filing.