What should a company do if its output tax exceeds its input tax?

When a company's output tax exceeds its input tax, it indicates that the business has collected more in VAT from sales than it has paid on purchases. In this scenario, the appropriate course of action is to pay the difference to HMRC.

This is because the company is responsible for passing on the VAT it has collected on its sales to the tax authority. The excess output tax represents a liability that needs to be settled. By making this payment, the company fulfills its obligation to HMRC, ensuring compliance with VAT regulations.

The other options describe actions that would not be suitable for this situation. Claiming a refund applies when input tax exceeds output tax, while adjusting the input tax amount or increasing output tax does not directly address the requirement to remit the excess amount due to HMRC. Thus, paying the difference is the correct response to the situation, as it aligns with the company's fiscal responsibilities.