Ammended invoices

Hi guys,

I get all the good clients, me!

So, I have a client who has invoiced all of his clients with VAT on the invoice, but they aren't VAT registered (well done client!)

I've told them all about late registration penalties... etc (as you'd expect), and the client came back and said 'well, what if I reissue the invoices explaining that the previous one erroneously showed VAT, showing a new figure equal to the previous gross amount?'

I said no, if you've charged VAT you've a legal obligation to pay it over. But it did make me wonder... could they get away with this? (n.b. I don't believe that any of their clients are VAT registered, so nobody will have reclaimed any of the VAT they paid).


  • john8589
    john8589 Registered Posts: 5 Regular contributor ⭐
    Hi Mike

    I'm not a VAT expert, but ...

    I'm surprised one or two clients have not queried the 'VAT' invoices issued by your client, as surely there isn't a VAT number on the invoices (unless he made one up!).

    He can reissue invoices, but I would say if he reissued the invoices it would have to be at the net amount only?!

    If he is already near the threshold for registration or anticipates to be in the near future, I think it would be best to register now and deal with the penalties.

    Sorry I can't be any more of a help, but somebody else may be able to give some better advice..

  • PGM
    PGM Registered Posts: 1,954 Beyond epic contributor 🧙‍♂️
    I'd have thought re-issue the invoices at the correct amount and refund the vat amounts?
  • Tracy_Rutherford
    Tracy_Rutherford Registered Posts: 19 New contributor 🐸

    If your client is not at the VAT threshold he can register voluntarly, this way there will be no penalties and he can back date his vat registration date up to 4 years, so the invoices he has raised with VAT on will be ok.

    Tracy :)
  • deanshepherd
    deanshepherd Registered Posts: 1,809 Beyond epic contributor 🧙‍♂️
    Very interesting.

    My instinct would be to reissue at the net amount and repay but.. if he is on good terms with all his clients he could go down the route of explaining to them that he incorrectly included VAT on the invoice and has since been advised by his accountant that was an error.

    I guess it is down to the original agreement he had with those clients as to how much they were going to pay for his service.

    There is certainly no obligation for him to register and pay it over if that is not suitable for him. He does have an obligation to sort the situation out with his customers and reissue proper invoices though.
  • villapb
    villapb Registered Posts: 357
    I check every invoice for a vat number, if i dont see one i query it, just a habit of mine and it has got me a load of brownie points i can tell you, from the boss and clients. I have found when i have spoke to the vat guys they have always helped me, i always make them tea or coffee and one vat inspector thanked my boss i a letter for all the cups of tea and if i ever needed help just call, and i have on a times. I find the vat inspectors are ok if your are ok with them.
  • villapb
    villapb Registered Posts: 357
    NEVER pay an invoice if no vat number on every time, also the client cant make one up can they.
  • villapb
    villapb Registered Posts: 357
    Hi Mike, was just thinking, talk about opening a can of worms, charging vat and what did the client do with the money, sounds dodgy i wouldnt be happy to be honest and i would be asking a lot of questions.
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