If you’re a VAT registered business, you can reclaim VAT paid on your purchases, but you’ll need to obtain the right documents to keep HMRC happy. 

See below for advice on what to need and how long you need to keep it for:

How to keep VAT records

You must keep VAT records for at least 6 years.

You can keep VAT records on paper, electronically or as part of a software program (such as book-keeping software). Records must be accurate, complete and readable.

If you’ve signed up for Making Tax Digital for VAT, you must keep a digital record of anything that is needed for your VAT Return.

If you’ve lost a VAT invoice or it is damaged and no longer readable, ask the supplier for a duplicate (marked ‘duplicate’).

HMRC can visit your business to inspect your record keeping and charge you a penalty if your records are not in order.

You can hire a professional (such as an accountant) if you need help with your VAT.

VAT invoices

Only VAT-registered businesses can issue VAT invoices and you must:

issue and keep valid invoices – these can be paper or electronic
keep copies of all the sales invoices you issue even if you cancel them or produce one by mistake
keep all purchase invoices for items you buy

Valid invoices

You’ll use a full VAT invoice for most transactions. You can use:

a modified invoice for retail supplies over £250
a simplified invoice for retail supplies under £250 – and for other supplies from 1 January 2013

*You cannot reclaim VAT using an invalid invoice, proforma invoice, statement or delivery note.*

Exceptions

You do not need to issue a VAT invoice if:

your invoice is only for exempt or zero-rated sales within the UK
you’re giving goods as a gift
you sell goods under a VAT second-hand margin scheme
your customer operates a self-billing arrangement

Click below to be directed to HMRC’s website for more information.

Find Out More

Contact Us