Each business registered for VAT receives a VAT number, which is a unique identifier.
Here’s what you need to know about VAT invoices.
Unique Taxpayer References or Company Registration Numbers are not the same as VAT numbers, which can exist in the same company.
Also, read What is VAT reverse charge?
Why do I need a VAT registration number (VRN)?
VRNs serve as a means of identifying VAT-registered businesses. In a variety of different tax-related instances, you may require a VAT number.
VAT Returns and VAT numbers
Registering for VAT requires regular reporting of your VAT, either manually or with Making Tax Digital software, throughout the tax year.
Providing your VAT registration number on your VAT Return allows HMRC to confirm whether you have met your VAT reporting obligations and for what periods you need to report VAT.
Also, read What is VAT in Maths?
How to get a VAT number
VAT numbers are assigned when you register for VAT. You will receive a VAT registration certificate as soon as you complete the VAT registration process. This certificate contains your VAT number, the date of your first VAT return, and the ‘effective date of registration’ (the date on which your VAT taxable turnover crossed the VAT threshold or on which you requested to register voluntarily).
Also, read What is £600 plus VAT?
How to check a VAT number
It is possible that you will run into issues with your VAT returns if you enter the wrong VAT number.
Therefore, you should verify that any VAT number you provide to a client or supplier is accurate and valid whenever you sell to them, add it to an invoice, or provide it to them.
On the UK Government website, you can check the VAT number of a UK business quickly and easily.
Also, read What is £500 plus VAT?
VAT number format
VAT numbers differ from country to country in terms of their format, length, and structure. A VAT registration number within the EU is always followed by a sequence of letters and numbers that indicate the country.
An English, Scottish, and Welsh VAT number begins with the letters ‘GB’ followed by nine numbers. The VRN format for UK VAT numbers is GB123456789, for example.
The prefix “XI” would be used instead of “GB” if your business is based in Northern Ireland and you trade with the EU. XI123456789, for instance.
Also, read VAT Threshold
Why I Need to Verify a VAT Number
Knowing something about a company is important whenever you do business with it. You can get a more detailed look at things like turnover, profit, and assets by using a service such as DueDil, instead of just doing a quick Google search.
The VAT number of any VAT-registered business you deal with must be verified regardless of how thorough you are.
How does a VAT number look?
A UK VAT number consists of nine digits and often begins with the letters ‘GB’ if you’re new to VAT.
To understand how VAT numbers in the EU are formatted and styled, visit the Government’s website.
Also, read How to Calculate VAT Inclusive?
VAT Registration Numbers: why it’s important to check them
HMRC may disallow your tax input claim if you don’t check a VAT number on your return and you enter an invalid number on your return.
It happens that people try to use someone else’s VAT number to commit fraud in some cases, but most errors with VAT numbers are innocent mistakes.
This can be done quickly and easily. You can avoid any issues with this by following the steps below.
Checking VAT Registration Number
UK VAT registration can be checked in two ways. Here are some options:
- Contact the HMRC VAT Helpline at 0300 200 3700. During the week, you can reach this number between 8 a.m. and 8 p.m.
- Businesses in the EU can check their VAT status online by using the VIES website. Using real-time data feeds from individual VAT systems, this website provides VAT information in real-time.
A VAT number that appears invalid on the website should be checked with the company to ensure it is correct. As well, you might want to let them know that the VIES site is incorrectly displaying their number, so they can contact HMRC.