VAT invoice from previously non VAT reg company

[ChrisWXM]

Hi I am currently doing my VAT return and have a couple of invoices supplied from companies who were not VAT registered at the time I made the purchase.

When I asked one of the companies for a VAT invoice they explained they were not VAT registered at the time but would be shortly and they would provide me with a VAT invoice once they were registered.

What I want to know is, is this possible. And if so how far back can they go. One invoice is from April 2008 and they became VAT registered in Jan this year.

[hgc services]

The invoice should have the tax point date on it and it should be the date that the work was completed. If this was before they were VAT registered then they shouldn't charge you VAT.

[ChrisWXM]

Hi Chris

Thanks for the reply. I take it then I cannot claim anything back on my VAT from my purchase from this particular company. One thing they did say was that they were shortly going to apply for VAT registration and would be able to issue me with a VAT receipt once they had their VAT number, I presume this was incorrect then and was only said to guarantee their sale.

Shame really as I have nearly £1000 in invoices from 2 different companies claiming that they could offer me a VAT invoice once they became VAT reg.

Chris

[ginantonic]

Interesting thread...my son has just voluntarily Vat registered himself because one large company he deals with say they can't deal with him otherwise. How long does it take to come through, and can he invoice them retrospectively?

[ChrisWXM]

Hi Ginatonic

When I registered back in March last year it took 3 weeks. Some people say it takes a lot longer, seem people also say they apply and get rejected.

I have now learnt though not to deal with companies for my supplies who aren't VAT registered as the prices normally charged by them are the same as other places inc. VAT anyway and I can then claim the VAT proportion back.

[GillespieBS]

The reality is that registering for VAT is not a straight forward process anymore since HMRc were caught out by carousel fraudsters.

If you want to voluntarily register your new business today, as you know you are going to go over the VAT threshold limit, you may face further scrutiny and go through a long process to prove yourself. In the meantime you will not be able to charge VAT and your customers will not reclaim anything. On getting your VAT registration it would be backdated to the date you had orignaly asked to be registered from which means that you will have to either credit all your sales invoices and reissue with the VAT element or simply raise an invoice for the additional amounts.

I've found (as people suggest in this thread) that companies sometimes won't work with you if you are not registered, yet HMRC won't register you if you cannot show evidence of invoices and bank receipts. Seems a bit destructive to small business to me.

I would have thought that HMRC could put the due diligence in before refunding money on VAT reclaims rather than preventing small business from operating in these challenging times.

[graemepirie]

Hi Chris

Thanks for the reply. I take it then I cannot claim anything back on my VAT from my purchase from this particular company. One thing they did say was that they were shortly going to apply for VAT registration and would be able to issue me with a VAT receipt once they had their VAT number, I presume this was incorrect then and was only said to guarantee their sale.

Shame really as I have nearly £1000 in invoices from 2 different companies claiming that they could offer me a VAT invoice once they became VAT reg.

Chris

If you are sure they have charged you VAT then you should pursue them.

Charging VAT without passing it on to HMRC is fraudulent.
Not giving VAT receipts when asked is also fraudulent.

[David Griffiths]

There seem to be two possible situations here.

One is that the business has applied to be registered from, say, 1 March. That means that it will have to account for VAT on all supplies after that date,but cannot currently give a valid invoice without a registration number. That way, I'd expect them to give an invoice for £115 now, and replace it with an invoice for £100 + £15 VAT when the registration comes through.

However, if you bought the goods before 1 March, then they won't be able to give a VAT invoice because the supply was before the date of registration.

The other scenario is that the business should have registered some time ago, perhaps in April 2008, but didn't. They've now registered and the effective date may well be 1 April 2008, so they will be able to issue a VAT invoice for the transaction in that month. However, it's possible in those circumstances that they'll issue an invoice for the VAT that they didn't charge at the time, and ask you to pay it now. Theoretically, you wouldn't be out of pocket because you can simply reclaim it. I'm not sure that legally you have to pay it, but that's a separate issue.

[GrahamCT]

When I first registered for VAT, I was told that I should charge VAT straight away on all my invoices but that I shouldn't show it as a seperate amount until I had been issued with a vat registration number, until then I was to simply put a note saying something to the effect of:
The total amount shown on this invoice included VAT at the rate of ##, a VAT invoice will follow shortly.
If your suppliers have told you that the total charged does include VAT then I would account for it as if it was a VAT invoice. Then as has already been said, if they have collected VAT on behalf of HMRC and yet failed to pass in on to HMRC then that's thier look-out and they'll find themselves locked up in the Tower of London.