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VAT is a complex tax and it can be difficult to navigate. But it is also important for all businesses to understand the VAT eligibility of themselves and their suppliers. If you need to check if a company is VAT-registered, there are a few different avenues you can go down. And if you need advice on all things VAT, Auditox Accountancy can help you. We understand the ins and outs of VAT rules and regulations and will give you professional advice on any aspect that you need.
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VAT is Value Added Tax. It is a levy applied to almost all goods and services in the UK. The standard rate of VAT is 20%. This is added by the goods and services businesses before the sale so a personal consumer will only see the final amount with VAT included. VAT is paid by the consumer but it is the business's responsibility to pay this money to the government.
For some goods and services, a reduced VAT is applied. This can be either 5% or 0% and applies to things like children's clothing, food, child car seats, domestic fuel, and mobility aids.
Find out more: How To Avoid Paying VAT As A Business
The short answer to this is: no. Not all businesses are VAT-registered. It is UK law that all businesses with an annual turnover of more than £85,000 have to be registered for VAT.
For smaller businesses, there is no such requirement. This can be helpful for growing businesses because it means that they don't have to add VAT to their prices so they can be competitive with their pricing.
Some smaller businesses choose to voluntarily register for VAT even if they come under the VAT thresholds. This may be because they expect to grow quickly. VAT-registered businesses can use VAT to help increase their profits as they grow and they can use it to offset any VAT paid on their supplies.
On the other hand, many smaller businesses will choose to stay unregistered. Becoming a VAT registered company can be time-consuming and there are lots of rules and regulations that apply. A company will also be required to submit a VAT return as well as its standard tax return.
If you run a business that regularly buys or sells goods and services, it can be important to find out if the companies you are dealing with are VAT-registered. As part of your annual tax returns, you can be eligible to claim back the VAT you have paid on goods and services supplied for your business.
However, only VAT-registered businesses can claim back VAT as business expenses on goods and services and only if the supplier is also VAT registered. When the claim is submitted, you will need to provide the supplier's VAT number.
If you try to reclaim VAT without a valid VAT registration number for your supplier, the claim can be rejected by HMRC and you will need to pay the full amount.
From the supplier's point of view, knowing if the company you are selling to is VAT-registered will help you to invoice them correctly.
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In an ideal world, you should actually never be left having to check if a company is VAT-registered. The government has clear regulations about what must be included on an invoice. This includes the date, the goods that were supplied, the company name and address, and more. For VAT-registered businesses, a VAT invoice must be used that clearly displays the company's VAT number.
And, as part of the Payment Services Regulations 2017, businesses must provide certain information about themselves, including their VAT registration number.
But we don't live in an ideal world and there is a chance you'll end up in a situation where you don't have a valid VAT invoice and are unable to check it to find out the company's VAT number.
Thankfully, there are a few different avenues you can pursue to find a company's VAT status and VAT registration number. Where you need to look will depend on whether the business is UK-based or EU-based.
UK VAT numbers come in four different formats. They will all start with the letters GB followed by a string of numbers and/or letters.
All VAT-registered companies in the UK will have a unique VAT registration number that follows one of these formats.
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If you have a dig around a company's website, you can have some luck finding a VAT number. If it's there, it will usually be on the About Us or Contact Us section of the site, often in the footer.
The direct approach can be the simplest and most efficient. If you can't find a VAT number on your invoice and you have a line of communication with your supplier, firing off a quick email can get you the answer pretty quickly.
HMRC has a complete database of all UK companies, including their VAT numbers. They have an online form that you can fill out to find a VAT number using their Check a VAT Number service. You can use this to:
If the online form is no help, you can use the HMRC VAT helpline to talk to an advisor.
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Companies House doesn't display VAT numbers but it will have lots of other information about a business that can help you in your search, such as its company registration number, name and address of the business, and more.
There are a variety of websites you can use that can help you to find a company VAT number. Some of these sites will require you to take out a subscription or pay a fee for the information.
VAT registration numbers for businesses that are part of the European Union are relatively easy to find. The business will have a unique VAT registration number that begins with the country code for the country it is registered in followed by a string of 2-12 alphanumeric characters.
You can find the relevant country codes with a quick Google search and they are abbreviations of the country's name. The codes are standardised and used across all documentation related to that country.
The EU hosts a VAT Information Exchange System (VIES). This is a complete database of all the VAT-registered companies in the EU. It will allow you to:
This is a free service but you will need to create an account to access the information.
As with a UK VAT-registered business, you can look at the company's website to find their VAT registration details and number. This will usually be in the About Us or Contact Us section of the website.
If you can communicate with the company directly, you can get in touch and request their VAT registration number.
If you are still having trouble finding the number, you can use a third-party website although these may cost money to use.
If you suspect that the company you are dealing with meets the VAT registration threshold of a turnover of £85,000 per year but they don't have a valid VAT number, you can get in touch with HMRC to report your concerns via their VAT helpline.
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At Auditox Accountancy, we understand the importance of having a reliable and knowledgeable accountant or tax advisor. Our team of experienced accounting professionals is on hand to help you with all aspects of VAT and tax. Whether you need someone to make sense of VAT registration, VAt returns, VAT-related business expenses, or more, we will provide you with impartial, practical, and helpful advice.
All companies that are registered for VAT will have a unique VAT registration number and this should usually be displayed clearly on any invoices you receive from them. If it isn't, you can find the number in a variety of ways, including HMRC's online VAT database or the EU's VAT Information Exchange System (VIES). Or the company should provide you with their VAT registration number if you ask them directly.