Time limit on VAT late claims! How far back can I go to claim input VAT?

Under normal circumstances, your business should claim back VAT on the VAT return for the period incurred. However, sometimes you can fail to claim VAT in the proper VAT period, following different circumstances. Luckily you can still reclaim the input tax in a later return or via a standalone claim – this practice is commonly referred to as a ‘Late Claim’. This article talks about the time limits of reclaiming late VAT – and what is (or is not) allowed.

Rules for late VAT claims

To make a late VAT claim:

• The claim must be within the set limits.
• The claim should not exceed the £10,000 HMRC limit or 1% of your box 6 figure (up to a maximum of £50,000).

Time limits – how far back can I claim input VAT

HMRC will allow your business to reclaim input VAT at any time up to four years from the due date for the VAT return on which the original claim should have been made. It is crucial to bear in mind that it is not four years from the date of the invoice.

For example, if you received an invoice from your supplier dated 11^th April 2021 – and you failed to make a VAT claim in the quarter ending 30^th June 2021 (if your VAT quarters end in March, June, September and December) – you have up to 30^th June 2025 to make a reclaim.

Amount – when the unclaimed VAT exceeds the £10,000 limit

HMRC describe the £10,000 limit as a net value of £10,000 following the difference between what you owe HMRC and what they owe you after an error. If your unclaimed VAT amounts exceed £10,000 - use Form VAT 652 separately from the VAT return to inform HMRC of your claim.

Time limits for claiming pre-registration input VAT

After registering for VAT, HMRC allows you to reclaim pre-registration VAT expenses on:

• Services – up to six months.
• Up to 4 years for goods you still have or goods used to make goods that you have currently.

If you did not claim your pre-registration VAT on your first VAT return, you have up to four years after the due date of your first VAT return to make a claim.

Late VAT claims for partial VAT exempt businesses

For partly VAT-exempt businesses looking to make a late claim for input tax for general expenses - the amount of VAT you can reclaim applies to the VAT period in which the purchase was made and not the one in which you are making the claim.

Reclaiming VAT on Errors

If you make an error in your VAT return (for example, if VAT on a purchase invoice is not claimed in the correct VAT period) you can make an adjustment to reclaim the missed VAT on a future VAT return.

However, if the total errors for under-claimed VAT exceed £10,000 – you may need to talk to HMRC about filling Form VAT 652.

You can also visit the HMRC website for more information on reclaiming VAT on errors.

Late VAT claim advice and support

If you want to reclaim late VAT, it is crucial to remember late VAT claims run from the due date for the VAT return covering the date of purchase.

Spondoo Accountants has a team of VAT experts who can help you with your VAT concerns and needs. Call us at 02033 259 341 for support.