There can be times when you get an invoice from a supplier which includes VAT and you just want to check if they really are registered. Because, shock horror, there’s some nasty people out there who run a business for a few years, charging VAT to their customers but never passing that over to HMRC.

But why do you care? Here’s why: in order to reclaim VAT paid to suppliers on your VAT return, you need to be in possession of a “valid VAT invoice”. And if they aren’t registered for VAT, whatever invoice they give you can’t be valid. They’ve just charged you 20% more without you realising it.

So, five years down the line when that director is spending time at “His Majesty’s Pleasure”, HMRC will be coming back to you to try and recoup the VAT you innocently reclaimed on those invoices.

And it could be £tens or even £hundreds of thousands of pounds…

One Simple Thing You Can Do

If you’ve bought something from Tesco or Dell, you can be pretty confident their vAT invoice is legit. But for any new supplier, you can check if a VAT number is genuine in just a few seconds. Here’s where the journey starts:

https://www.gov.uk/check-uk-vat-number 

Hit Start Now, and pop in the VAT number which is on their invoice. Then hit Search and…magic!

Hopefully, it’ll tell you it’s not only a valid VAT number but it’ll also show you WHO that number is registered to. Make sure the name and address are in line with what you were expecting from the invoice.

If there’s any uncertainty here then do speak to the supplier to confirm what’s going on. It could be legit – like a very recent change of address, or perhaps their official company name is different to the brand they trade as.

But don’t be afraid to give your accountant a call as well, if you want a second opinion. 

A Brand New Business?

HMRC aren’t the quickest, and it can take a few weeks for a new VAT registration to show up here. So, if your search turns up nothing but the supplier insists they are indeed VAT registered, then you’ve got two options here:

1) Re-do the search in a couple of weeks, and only pay the VAT element of the invoice once it’s showing up.

2) Ask the supplier for a copy of their VAT certificate. [They are not legally obliged to share this with you, however]

Either way, I’d advise you never pay a VAT invoice unless you’re confident the VAT number is valid. Otherwise, when it all goes wrong, HMRC will be after that VAT back from you!

How can Accountants help?