Pay VAT online: methods, deadlines and payment steps

Published Friday 17 April 2026

Table of contents

• VAT payment deadlines
• Online VAT payment methods
• What you need to pay VAT online
• How to make online VAT payments
• Steps for filing and paying VAT online
• Getting VAT repayments
• Using software to automate VAT payments
• Simplify VAT payments with the right tools
• FAQs on paying VAT online

Key takeaways

• Plan your VAT payment method based on your deadline, as funds must clear in HMRC's account by the due date — use online banking or CHAPS for same-day processing if you're close to the deadline, or set up direct debit for fully automated collection.
• Gather your 9-digit VAT registration number and HMRC's bank details (sort code 08-32-10, account 12001020) before making any payment, as these are required for all online payment methods.
• File your VAT return using Making Tax Digital (MTD)-compliant software, as this has been mandatory for all VAT-registered businesses since April 2022 — filing and paying are two separate steps, both of which you can complete online.
• Check your HMRC VAT online account after paying to confirm your payment was received, allowing up to 48 hours for most methods to show, and contact HMRC if your payment is still pending after the expected processing time.

VAT payment deadlines

VAT payment deadlines are the dates by which your payment must clear in HMRC's account to avoid penalties. For most businesses, this is one month and seven days after the end of an accounting period, typically representing each VAT quarter.

The funds must be in HMRC's account by the deadline date, not just sent. Plan ahead to ensure your chosen payment method processes in time.

If you use the VAT Annual Accounting Scheme, your deadline is different. You'll need to make advance payments towards your VAT bill throughout the year, with a final payment due two months after the end of your accounting year.

Online VAT payment methods

Online VAT payment methods let you pay HMRC digitally without visiting a bank or posting a cheque. You have six options, grouped by processing speed.

Fast options (same day or next day):

• Use online banking for same or next-day processing via Faster Payments
• Use CHAPS for guaranteed same-day payment (costs £25–£30)

Standard options (three working days):

• Set up direct debit for fully automated collection by HMRC
• Send a BACS transfer as a manual bank transfer you initiate each time
• Pay by debit or credit card through the HMRC BillPay service
• Arrange a standing order for fixed amounts only (Annual Accounting Scheme)

Each payment method suits different situations and deadlines. The following sections explain how each method works and what you need to use it.

1. Online or telephone banking (using the Faster Payments service)

Online banking processes VAT payments on the same day or next day, even on weekends and bank holidays. This makes it ideal for last-minute payments close to your deadline.

Log into your bank's online or telephone banking service and transfer funds using HMRC's sort code and account details.

2. CHAPS

CHAPS (Clearing House Automated Payment System) guarantees same-day VAT payment when you need certainty. Send your payment instructions by 2 pm on a working day to ensure same-day processing.

Each CHAPS payment costs £25–£30, so it's best suited for large VAT bills where the fee is proportionally small.

3. Direct debit

Direct debit automates your VAT payments completely. Once set up, HMRC collects the money without any action from you.

Here's how it works:

• Set up once through your free HMRC VAT online account
• Expect collection three working days after your return due date
• Allow three additional working days for processing to complete
• Ensure sufficient funds in your account before the collection date

4. BACS

BACS (Bankers' Automated Clearing System) is a bank transfer you initiate each time, unlike direct debit where HMRC collects automatically. You control when the payment is sent.

BACS takes three working days to process. You'll need to sign up for BACS with your bank and get a BACS Service User Number before using this method.

5. Debit or corporate credit card using BillPay

Yes, you can pay VAT online by card through the HMRC BillPay service. Accepted cards include personal debit cards, business debit cards, and business credit cards.

Only business credit and debit cards are accepted. These incur a small, non-refundable fee.

6. Standing order

Standing orders pay a fixed amount at regular intervals, making them suitable only for predictable VAT bills. This option is only available to businesses using the Annual Accounting Scheme.

When you apply for the scheme, you can request standing order payments and get approval from HMRC. Standing orders work best when your VAT amounts stay consistent each period.

What you need to pay VAT online

Before you start your payment, gather the necessary information based on your chosen payment method.

Your 9-digit VAT registration number is required for all payment methods. Gather this before you start.

Depending on your chosen method, you may also need the following:

• Your bank details: sort code and account number
• Banking access: online or telephone banking login
• HMRC's bank details: for bank transfers (sort code 08-32-10, account 12001020)
• A valid card: personal or business debit card, or corporate credit card

How to make online VAT payments

To make an online VAT payment, you'll need your VAT registration number and the correct HMRC bank details. Here's what to have ready.

For all methods, you need:

• 9-digit VAT registration number
• HMRC payment details: Sort code 08-32-10, Account number 12001020, Account name HMRC VAT

Here are the method-specific requirements:

• Direct debit: Provide your bank account details and allow three days setup time before your first return
• Card payments: Use a personal or business debit card, or a corporate credit card
• Bank transfers: Access your online or telephone banking service
• Standing orders: Confirm a fixed payment amount (Annual Accounting Scheme only)

Read more about paying VAT on the GOV.UK website

Steps for filing and paying VAT online

Filing and paying VAT are two separate steps, but you can complete both online. Most businesses file through Making Tax Digital (MTD) software, then pay using one of the methods above.

1. File your return

Making Tax Digital (MTD) software is mandatory for filing VAT returns. You must use functional compatible software to submit your return to HMRC, a requirement that has applied to all VAT-registered traders since April 2022.

You have the following filing options:

• Use MTD-compliant software like Xero to handle filing and payment automatically
• Use your HMRC VAT online account as a basic option

Existing direct debit arrangements transfer automatically to MTD systems.

If you're already a Xero customer and looking for how to file your VAT online, help is available through Xero Central.

2. Make your VAT payment

Use your preferred payment method to pay your VAT online.

3. Check your payment was received

Check your HMRC VAT online account to confirm your payment was received. Your account shows payment status and any outstanding balance.

Here are the expected confirmation times:

• Expect account updates within 48 hours of payment
• Allow up to three working days for BACS, direct debit, and card payments to show
• See immediate confirmation for online banking and CHAPS payments

Contact HMRC if your payment is still pending after the expected processing time.

Getting VAT repayments

VAT repayments happen when you've paid more VAT than you owe, typically because your input VAT exceeds your output VAT. HMRC refunds the difference automatically.

Here's how the repayment process works:

• Expect payment within 30 days of return submission
• Receive funds by direct deposit to your business bank account or by cheque
• Take no additional action as processing is automatic

HMRC pays interest on overpaid tax being repaid at the Bank of England base rate less 1%.

Learn more about Making Tax Digital for VAT with Xero accounting software

Using software to automate VAT payments

Accounting software automatically calculates VAT and files returns, reducing manual work and the risk of errors. MTD-compliant software like Xero prepares and files your VAT returns directly with HMRC.

Here are the key benefits of using software:

• Automatic calculations show exactly what you owe
• Bank connection gives you a real-time view of your finances
• Easier budgeting helps you plan for your VAT bill

You spend less time on admin and more time running your business.

Simplify VAT payments with the right tools

Paying VAT online can be straightforward. Choose the method that fits your deadline and workflow, whether that's automated direct debit or fast online banking for last-minute payments.

The right accounting software takes even more off your plate. With Xero, you can calculate your VAT, file your return, and track your payment status in one place. You spend less time on admin and gain more confidence that you've got it right.

Ready to simplify your VAT? Get one month free and see how Xero can help.

FAQs on paying VAT online

Find answers to common questions about paying your VAT bill online below.

What happens if I miss the VAT payment deadline?

Late VAT returns result in penalty points. Once your points equal these thresholds (such as four points for quarterly returns), you'll receive a £200 penalty.

Each subsequent late filing while at the threshold adds another £200 penalty. You may also face separate penalties and interest for late payment.

How much do different VAT payment methods cost?

Most VAT payment methods are free. Here's what to expect for each method:

• Faster payments and direct debit: Free
• BACS: Free (check with your bank)
• CHAPS: £25–£30 per payment
• Corporate credit or debit card: Small, non-refundable fee

Can I change my VAT payment method?

Yes, you can change your VAT payment method at any time. You're not locked into one option.

To switch methods, set up your new arrangement through your HMRC online account. Cancel any old payment arrangements to ensure you only pay once.

What should I do if my VAT payment fails?

Retry your payment immediately using a different method if needed. Faster payments or online banking can process same-day to help you meet the deadline.

1. Check your HMRC online account to confirm whether the original payment went through
2. Use a faster method like online banking if you're close to the deadline
3. Contact HMRC if you have concerns or need to discuss your situation

How far in advance should I set up direct debit for VAT?

Set up direct debit at least three working days before submitting your VAT return. This ensures the arrangement is active when HMRC attempts to collect payment.

You only need to set it up once. After that, payments are collected automatically for each return.

Can I pay VAT with a personal credit card?

Only personal debit cards, business debit cards, and corporate credit cards are accepted for VAT payments. You can use any of these options through the HMRC BillPay service.

How do I check my VAT account balance?

Sign in to your HMRC VAT online account to view your current balance, payment history, and any outstanding amounts. Your account updates within 48 hours of making a payment.