VAT Problem with new client

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Kelloggs
Kelloggs Registered Posts: 7 New contributor 🐸
in General accounting discussion
Hi,

I have just taken on a new client who isn't VAT registered. When he started trading he was issuing invoices with no VAT on them, and then a customer told him that they needed a VAT invoice. My client then invoiced again, and added VAT on. He has done this several times since for this client.

I have never dealt with this before, so can anyone help with what to do next. My initial feeling is that he should re-issue the incorrect invoices and repay the VAT to his customers, but I'm not sure if this is correct.

Thanks

Kel

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  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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    He is absolutely not allowed to issue VAT invoices if he is not VAT registered.
    He must correct the situation immediately, by contacting the customers and repaying any monies due (if he added VAT on, as opposed to reissuing invoices that were 'vat included' on his original gross amount). And he must never do it again. The answer to "I need a VAT invoice" is "I am not VAT registered so can't give you one. There is no VAT."
    If he does not correct in full, report to SOCA under MLR.
  • Poodle
    Poodle Registered Posts: 711 Epic contributor 🐘
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    I absolutely agree with faerie9.

    Plus the person asking for the invoice would not be able to recover input VAT without a genuine VAT registration number on the invoice anyway.

    Poodle
  • Kelloggs
    Kelloggs Registered Posts: 7 New contributor 🐸
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    Thanks for that. That's what I thought, but I just wanted someone elses input. I have told him, and after a bit of swearing he is going to sort it out asap.

    Thank you!:thumbup:

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