It can do reports on VAT, but I'm not really sure what information you need
to do a VAT return. Would suggest trying a trial version and seeing whether
it does what you need. For links to the trial versions see http://money.mvps.org/downloads.aspx
I would not recommend any serious business to use Money for VAT returns. I
have been using Money for my personal transactions and it is great. I am an
accountant in the UK who provides advice to businesses for software, contact
me if you want any software recommendations.