UK Tax in Odoo
UK businesses must comply with Making Tax Digital (MTD) for VAT — submitting VAT returns digitally via HMRC-compatible software. Odoo supports UK localization with VAT configuration, UK chart of accounts, and MTD-compatible reporting.
VAT Rates
| Rate | Applies To |
|---|---|
| 20% | Standard — most goods and services |
| 5% | Reduced — domestic fuel, children's car seats |
| 0% | Zero-rated — food, children's clothing, books, exports |
| Exempt | Insurance, education, health, postage |
Setup
# Select United Kingdom during Odoo setup
# Installs:
# - UK chart of accounts
# - VAT at 20%, 5%, 0%
# - UK fiscal positions
# - GBP as default currency
# Company:
# VAT Registration Number: GB 123 4567 89
# Company Number: registered at Companies House
# UTR (Unique Taxpayer Reference): for HMRCMaking Tax Digital (MTD)
# MTD requirements:
# 1. Keep digital records of VAT transactions
# 2. Submit VAT returns via MTD-compatible software
# 3. No manual transcription (digital links required)
# Odoo → MTD workflow:
# 1. Record all transactions in Odoo (digital records ✓)
# 2. Generate VAT return data from Tax Report
# 3. Submit via MTD-compatible bridge software
# (or Odoo community MTD module)
# 4. Receive confirmation from HMRC
# VAT Return boxes:
# Box 1: VAT due on sales
# Box 2: VAT due on EU acquisitions (post-Brexit: minimal)
# Box 3: Total VAT due (1+2)
# Box 4: VAT reclaimed on purchases
# Box 5: Net VAT (3-4)
# Box 6: Total sales (ex-VAT)
# Box 7: Total purchases (ex-VAT)
# Box 8: Total EU supplies (post-Brexit: minimal)
# Box 9: Total EU acquisitions (post-Brexit: minimal)Reverse Charge (Post-Brexit)
# Domestic reverse charge for construction (CIS):
# Subcontractor invoices → buyer accounts for VAT
# Import VAT:
# Since Brexit, imports from EU treated like non-EU
# Postponed VAT Accounting (PVA) available
# Account for import VAT on VAT return (no cash payment at border)
# In Odoo:
# Create reverse charge tax group
# Fiscal position for CIS subcontractors
# Import VAT fiscal position for EU/non-EU purchasesPAYE Payroll
# UK payroll deductions:
# Income Tax: based on tax code and brackets
# National Insurance (NI): employee and employer
# Student Loan Repayment: Plan 1, 2, or 5
# Pension auto-enrollment: min 8% (3% employer + 5% employee)
# RTI (Real Time Information):
# Submit FPS (Full Payment Submission) to HMRC each pay day
# Odoo payroll + UK module or third-party integrationDeployMonkey for UK
Deploy Odoo for your UK business on DeployMonkey. The AI agent configures UK VAT, MTD-ready reporting, and fiscal positions for domestic, EU, and non-EU trade.