If your business is in the UK, depending on your registration, your business may need to a VAT return.

To prepare a VAT Return in Xero, follow the steps below:

1. Go to Reports > VAT Return
2. In “Ending:” select the period month end and click “Update”. Xero will pre-populate your report so make sure that the transactions you’ve entered in throughout the period are correct!
3. Your VAT return and VAT Audit Report will be generated - review these reports.
4. Once you’re happy with the reports, click “File VAT Now” and complete all the fields necessary to publish the report. Once you’re done click “File and Publish”.
5. The “File VAT Return” window will appear. Check the box “File now with HMRC” and enter your details required and click “File & Publish”

Now you’re done! Easy wasn’t it?