VAT in the UK: Key Information for Late Claims

As a business owner in the UK, you may occasionally face challenges with VAT reclaims, especially when suppliers fail to provide proper VAT invoices. Here’s what you need to know about making late VAT claims and the rules surrounding them.

When Can You Reclaim VAT Without an Invoice?

Her Majesty’s Revenue and Customs (HMRC) requires evidence that VAT has been charged before you can reclaim it. While a VAT invoice is the standard proof, HMRC does accept alternative evidence in exceptional circumstances. Here’s what you should do:

1. If you haven’t received a VAT invoice, wait a reasonable time and ensure you’ve made several requests to the supplier.
2. If the invoice is still not forthcoming, you can use “alternative evidence” such as delivery notes and payment confirmations.

Key Timeframes for VAT Reclaims

1. General Rule: You reclaim VAT in the period when you received the invoice.
2. No Invoice Received: If you haven’t received an invoice, you can reclaim VAT once you have alternative evidence.
3. Time Limit: You have 4 years to reclaim VAT, starting from the due date of the VAT return for the period in which the purchase was made.

Example: How the 4-Year Limit Works

Let’s say your company, BritCo Ltd, purchased goods on 15 July 2021 but never received an invoice. The supplier ceased trading 18 months ago. If you have alternative evidence of VAT payment, you have until 31 October 2025 to reclaim this tax.

Important Note for Partially Exempt Businesses

If your business is partially VAT exempt and you’re making a late claim for general expenses (e.g., office supplies), remember: The proportion of VAT you can reclaim relates to the VAT period when the purchase was made, not the period in which you’re making the claim.

Using Alternative Evidence

When an invoice is not available, you can still reclaim VAT using “alternative evidence”. This should demonstrate that:

1. A supply has been made (e.g., a delivery note)
2. Payment has been made (e.g., bank records)

While there are no prescribed documents for this, ensure your evidence clearly shows the VAT element of the transaction.

Pre-Registration Purchases

It’s worth noting that you can reclaim VAT on certain pre-registration purchases. For example, if UKTech Solutions registered for VAT on 1 September 2021, they could potentially reclaim VAT on goods purchased up to 4 years before this date, provided they still have those goods.

Remember, VAT regulations can be complex. If you’re unsure about any aspect of your VAT reclaims, it’s always advisable to consult with a professional tax advisor.

Need help with your UK VAT returns? Contact us today – CLICK. Our experts can help you optimise your VAT reclaims and avoid potential issues with HMRC.