VAT Certificate?

[BeccaOnline]

Hi guys,

We have just commenced work for a new customer, and have just been told that they will not pay the VAT element of our invoices without seeing a copy of our VAT Certificate first.

This is a new one on me, I've never been asked it before and never asked any of our suppliers for a copy of theirs. Is this a valid request, or is this just a ignorance/a delaying tactic on behalf of their accounts deparment?

Thanks

[Williams lester]

If it gets the invoice paid, why not give them a copy?

[Fernhurst Solutions Ltd]

Becca, I can't say that I'ver ever of that before - but in business NOTHING would suprise me ..... I'd either e-mail or fax a copy of the certificate across then they have no excuse other than to pay your invoice IN FULL.

:D

[Kevin Hall]

It is more common with international transactions, where it is often essential to confirm the validity of a VAT registration number before zero-rating a sale.

However, there have been many VAT frauds in recents years, so every trader should take reasonable steps to verify that the VAT registration numbers of both suppliers and customers are valid. In cases of VAT fraud, HMRC often seek to recover lost VAT from other parties in the supply chain (e.g. you!) - effectively meaning that you are the one defrauded, not HMRC. Some VAT specialists on this forum might point out that HMRC have lost most cases where this is attempted; but small businesses can rarely afford the disruption an erroneous assessment for joint liability would cause.

There is a website which checks the validity of VAT registration numbers; but it will not tell you to whom that VAT registration number belongs. So thebest method is to obtain copies of VAT Registration Certificate.

Having said all that, it will also delay the payment date and "puts the ball in your court", so the customer is not to blame for the delay. Best policy is to have a scanned copy of your VAT Registration Certificate on your computer and simply fire it back as soon as you are asked for a copy.

Hope it helps?

[Philip Hoyle]

I'd let them have it to be honest. HMRC always seem to try to charge an "innocent" business when they are caught out by someone else - the easiest target approach! I advise my clients to make sure that their suppliers & customers are legitimate businesses - if only to make sure that their "contractors" would be targetted as potential employees. I have a list of things I'd like my clients to keep to help defend themselves in the future, and my list includes documents like a VAT registration certificate and business insurance certificate - my philosophy is that every little helps! Obviously, every case should be dealt with on its own merits and you shouldn't rely on any documents if you have real cause for concern, but I think it is good that we all "think" about who we are dealing with and consider what risks we may be taking by trading with them. I really can't see why anyone would object to faxing a copy of their VAT reg certificate.