The VAT return checks in Data Health & Insights give you a set of checks designed to quickly spot tax issues in your client's transaction data over a given VAT period. To access them, go to a client's account and select Data Health in the left navigation, then select VAT return checks under Tax.

The page header shows the client's current VAT Scheme, Reporting Cycle, and VAT Rate. Use the Period date range at the top of the page to select the VAT period you want to review.

The VAT return checks are available to practices on Practice Essentials and Practice Advanced plans with the Data Health & Insights add-on.

Before reviewing, make sure two things are set up correctly.

Dext defaults to the start of the organisation's financial year as the VAT starting month, but this may not match your client's actual VAT period.

Select Adjust Settings at the top of the page to open the Configure Your VAT Settings panel. Select the correct VAT Starting Month from the dropdown — the selected periods update automatically to reflect your choice — then select Save. If you're unsure of the starting month, select View the Tax Reports in Xero from within the panel.

Connecting your HMRC Agent Account unlocks the full value of the Estimated VAT and HMRC Status checks. Without this connection, Dext can't access filing obligations, payment history, or confirmed VAT figures.

Check Connecting to HMRC for VAT (UK Only) for setup instructions.

The Scheme Thresholds check looks at your client's annual and quarterly taxable turnover and confirms it's within the limits of their VAT scheme as defined by HMRC.

Expand the card to see the Quarterly Check and Annual Check rows, each showing the period, threshold, and taxable turnover. Select HMRC Scheme Thresholds to view the current thresholds on the HMRC website.

Alert states:

The tax status section contains three checks that give you a real-time view of your client's VAT position, HMRC filing status, and VAT control account balance.

The Estimated VAT check keeps a running estimate of VAT accrued or due to be reclaimed for the selected period. It handles Cash, Accrual, and Flat Rate schemes. The summary shows whether the client has VAT To Pay or To Reclaim for the period.

The HMRC Status check shows filing and payment information pulled directly from HMRC for the selected period. Expand the card to see two sub-sections:

The VAT Control Account check reconciles the VAT Control Account balance in Xero against current HMRC liabilities plus estimated VAT for the period. Expand the card to see the breakdown: HMRC Liabilities, Estimated VAT, Total Liabilities, VAT Control Account Balance, and the resulting Difference.

Dext always includes account code 820 (VAT) in this check. To add further account codes, select the settings cog next to the card title, choose additional accounts from the list, and select Save. These settings apply to this client only.

The Bank reconciliation section within VAT return checks uses the same logic as the standalone Bank reconciliation check and surfaces unreconciled transactions for the selected VAT period.

Expand the Unreconciled Transactions card to see a table showing Date, Bank Account, Description, Reference, Reconciled status, and Amount for each transaction.

The account code review section checks whether transactions have been assigned to the correct account type for their tax treatment.

The Revenue Account Review check finds transactions that don't have an account class of Revenue but have been assigned a revenue tax type (OUTPUT2, RROUTPUT, or ZERORATEDOUTPUT). These are potential miscoding issues that could affect your VAT return. Expand the card to see the full transaction list with Date, Contact, Description, Code, Account, Net Amount, Tax Amount, and Tax Type columns.

The Expense Account Review check finds expense transactions assigned a 20% VAT on Expenses tax type (INPUT2) that are coded to high-risk account codes — by default, Entertainment, Printing & Postage, and Travel International accounts. Expand the card to review the transactions.

To override the default account codes for this client, select the settings cog next to the card title. The VAT Expense Account Code Overrides panel shows suggested accounts (including Entertainment and Postage accounts) and a full searchable list. Select the accounts you want to include and select Save.

The Balance Sheet Review check finds Asset, Liability, or Equity type transactions with a non-zero tax value. Fixed Asset accounts and accounts with reporting codes for income in advance or prepayments are excluded. Expand the card to review flagged transactions.

The Tax Review By Code check groups all transactions in the period by the tax code applied to them, so you can review coding consistency across the return. Each tax code group shows the number of line items above the minimum value threshold and can be expanded to show individual transactions with Date, Tax Type, Created On, Contact, Description, and Account columns.

Each group also has filters for Balance Sheet, Profit and Loss, or All transaction types, and a Minimum Value field to focus on higher-value items.

To set a minimum transaction value that applies across all tax code groups, select the settings cog next to the Tax Review By Code card title, enter a value in the Minimum transaction value field, and select Save.

The Multi-Coded Contacts check within VAT return checks uses the same logic as the standalone Multi-coded contacts check, but scopes it to contacts active during the selected VAT period. It surfaces contacts with inconsistent account or tax code coding, grouped by contact and direction. Select dismiss on a difference group to suppress it from the results.

The high value transactions section surfaces transactions above a configurable minimum value, split by whether they have attachments.

The Transactions without Attachments check finds transactions at or above a minimum value that don't have any attachments — useful for ensuring VAT evidence is in place for high-value items. Expand the card to review transactions. Use the Balance Sheet | Profit and Loss | All and Manual Journals | Other Types | All filters to narrow the list.

To set the minimum value, select the settings cog next to the card title, enter a value in the Minimum transaction value field, and select Save. The default is £1,000.

The Transactions with Attachments check surfaces transactions at or above a minimum value that do have attachments, for review purposes. The same filters and minimum value configuration apply as for Transactions without Attachments.

You can include VAT return checks in a repeating Workflow triggered by the VAT return period, so your team works through them as part of a structured VAT preparation process. See Using Workflow Checks for more detail.

To update the VAT return checks, use the buttons at the top of the page:

If you've made changes in Xero, select Sync first, then Recalculate to see updated results.