HMRC Revises Procedure for Amending VAT Mistakes

HMRC has digitalized its VAT error correction process, replacing form VAT652 with an online system for improved efficiency. Errors under £10,000 or between £10,000 and £50,000 (less than 1% of total sales) can be adjusted in VAT returns. Exceeding thresholds must be reported directly to HMRC. Businesses use Government Gateway credentials for online corrections, while VAT-exempt businesses may notify errors by post or email, detailing specifics of the errors and adjustments

HMRC has digitalised its VAT error correction process, withdrawing form VAT652 in favour of an online system to improve efficiency and accuracy.

Correction thresholds

Errors can be adjusted in the next VAT return if the net value is under £10,000, or between £10,000 and £50,000 and less than 1% of total sales in the correction period. Errors exceeding these thresholds or otherwise ineligible must be reported directly to HMRC.

Note: Adjusting an error in your VAT return does not count as notifying HMRC for penalty reduction if HMRC deems the error careless.

Digital process

Businesses correct errors online using Government Gateway credentials. Since July 2025, agents can submit on behalf of clients via the same system. Access the online form through the "Check how to tell HMRC about VAT Return errors" tool.

Alternatives for digitally exempt businesses

MTD VAT-exempt businesses may notify errors in writing to the VAT error correction team by post (BT VAT, HMRC, BX9 1WR) or email (inbox.btcnevaterrorcorrection@hmrc.gov.uk ). Include:

• How each error arose;
• The vat accounting period it occurred in;
• If it was input or output tax;
• Vat underdeclared or overdeclared per period;
• How the under/overdeclared vat was calculated;
• Whether any errors resulted in paying hmrc an undue amount; and
• The total amount to adjust.

Agents can currently write on behalf of clients using these details, but the online route is recommended wherever possible