What does Box 3 consist of?

Box 3 on the VAT return represents the total of the amounts from Box 1 and Box 2. Box 1 contains the VAT due on sales, while Box 2 includes any VAT due on acquisitions from other EU member states. Therefore, by combining these figures, Box 3 gives an overall picture of the VAT that is due to be paid to HMRC based on the business’s sales activities and purchases from the EU. This total helps businesses assess their VAT obligations accurately, ensuring they remain compliant with tax regulations.

The other options do not provide a comprehensive view of Box 3. For example, considering only VAT due on purchases or merely the value of all sales excluding VAT omits crucial elements that are necessary for determining the net VAT payable. Hence, the most accurate representation of Box 3 is the summation of Boxes 1 and 2.