Her Majesty's Revenue & Customs (HMRC) are responsible for applying the law in the case of VATand there is a great deal of information available on their web site. What we provide here is an outline of the important issues regarding those records

As soon as your business is VAT registered you will need to obtain, issue and keep various documents - including invoices and receipts for items sold and suppliers' invoices and receipts for items bought

To ensure that you have a correct return you must show that the records are properly maintained. In every transaction there will be a VAT component that must be recorded in order that the amount due to be paid to, or received from HMRC is correct and these records must be available for scrutiny by a VAT Inspector at any time

You must:

provide a VAT invoice whenever you supply to a VAT-registered customer

keep copies of all invoices you send and keep original invoices you receive

keep a record of the total of VAT you have paid and charged

keep a summary of VAT for each tax period covered by your VAT returns

You don't have to keep records in any set way, but they must be maintained complete and up to date

HMRC provides a guide on how to set up a basic record-keeping system

VAT Records must be kept for a minimum of six years

VAT invoices must show the rate and amount of VAT charged and your VAT number. Make sure that invoices from your VAT registered suppliers show the same information so you are able to reclaim the VAT you pay

Whenever you supply goods or services on which VAT is chargeable to another VAT registered person or business, you must give them a document showing certain information about what you are supplying. This document is called a VAT invoice. Normally you must issue a VAT invoice within 30 days of the date you make the supply
.
You must show:

a unique and sequential identifying number for the invoice

date of supply

date of issue of the invoice (if different from date of supply)

name and address of your business

customer's name and address

your VAT registration number

a description sufficient to identify the item(s) supplied

the quantity of the goods or services, with a unit price - excluding VAT

the rate of VAT per item

the amount of VAT

the rate of any cash discount

HMRC provide an example of a suitable completed VAT invoice

See also

VAT Accuracy
VAT Overseas
VAT Penalties
VAT Return
VAT Taxables

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Last Update 08-Jan-2012

Date first published 18-Dec-2005