How to invoice customers while you are waiting for your VAT Number from HMRC
September 14, 2022
After submitting your VAT application there is a period where you cannot charge VAT while you wait for your VAT Number to be issued by HMRC.
In this period, you have 2 options:
Delay issuing invoices until the VAT Number has arrived (albeit this is not always possible as you need to get paid on time).
Issue proforma invoices until the VAT Number has arrived, you can request your standard fee plus an estimated amount for the VAT element, ensuring to make it clear that the estimated tax is not reclaimable by your customer until your real VAT Number has been received.
Below is some suggested text to place on your invoice to assist in making this position clear:
‘We have recently applied for a UK VAT Number and believe this invoice to be subject to 20% Standard Rated VAT. We have included a provisional amount on this invoice to reflect this value, but it is not reclaimable until you reissued a revised invoice after our VAT Number has been received from HMRC’’
If your customer receiving this proforma invoice is concerned about their ability to reclaim the estimated VAT detailed on the document, they can simply pay the net amount and wait to pay the balance until you issue your revised invoice containing the valid VAT Number.
The golden rule when claiming business expenses is that the cost must be “wholly and exclusively” for business purposes. So, where do you stand when it comes to food and drink? After all, everyone needs these things to survive. When does it become an allowable expense? Read on to find out when your business can claim food and drink as an expense.
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We are qualified accountants providing personal and professional services for start-ups, established companies and individuals in and around the Haslemere area in Surrey. With the rise in technology, we have embraced the digitisation of accounting using efficient digital accounting tools to offer reliable services to our customers. Our goal remains to get our clients the best accounting and taxation services at the most affordable rates.
The provision of food and drink to an employee by their employer is a lovely thing to do. Eventually, it promotes teamwork, loyalty, a sense of belonging and even improves productivity. Taking it at face value makes it look like a simple act of kindness. However, unless it is done correctly, it can cause tax and national insurance compliance issues for the employer.
Information provided on the site is merely guidance that may change in line with UK law and regulations. Users must not consider this to be financial advice or their sole resource when making any financial decision. Spondoo is a trading name for Accounting SQL Limited, authorised & license accounting firm under the Institute of Financial Accountants.
