A Comprehensive Guide to the Postponed VAT Accounting (PVA) Scheme

September 3, 2025

Introduction

The Postponed VAT Accounting (PVA) scheme was introduced by HMRC on 1 January 2021 as part of the UK’s post-Brexit VAT framework. Its purpose is to simplify VAT reporting on imports and ease the cashflow burden for VAT-registered businesses in the UK that import goods from the EU and the rest of the world.

At A2Z Accounting Solutions Ltd, We work with many clients who import goods regularly, and PVA has been a real game-changer for managing both compliance and cash flow.

In this blog, we’ll walk through what Postponed VAT Accounting is, how it works, who can use it, and how we at A2Z support our clients in applying the scheme effectively. 

What is Postponed VAT Accounting(PVA)?

Traditionally, when goods were imported into the UK, businesses had to pay import VAT upfront at the border before the goods could be released. This created significant cash flow challenges, especially for businesses with frequent or large imports.

The PVA scheme allows VAT-registered businesses to account for import VAT directly on their VAT return, rather than paying immediately at the point of entry.

At A22 Accounting Solutions Ltd, we make sure clients account for this correctly by setting up their VAT returns to reflect both the VAT due and the reclaimable Input VAT, ensuring full compliance with HMRC requirements.

Who Can Use the PVA Scheme (Eligibility)?

The PVA scheme is available to:

• All UK VAT-registered businesses that import goods into the UK from anywhere outside the UK (both EU and non-EU countries).

There is no application process – you can start using it immediately.

At A2Z,we advise our clients whether PVA is the light option for their import activities and ensure their bookkeeping and VAT systems are set up correctly to reflect postponed VAT.

How Does PVA Work in Practice?

When you import goods, instead of paying VAT at the border, you:

• Submit your customs declaration (or your agent does this on your behalf). You must select the option to use postponed VAT accounting.
• Access your monthly postponed import VAT statement (MPIVS) from your HMRC online account.
• Include the VAT in your VAT return:
  1. Box 1(VAT due on sales and other outputs) – the VAT due.
  2. Box 4 (VAT reclaimed on purchases and other inputs) – the reclaim, if eligible.
  3. Box 7 (total purchases excluding VAT) – the value of imported goods.