Input tax ― evidence for VAT recovery

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note looks at the evidence that needs to be kept for a business to support a claim for recovery of input tax.

For an overview of input tax more broadly, see the Input tax ― overview guidance note.

For in-depth commentary on the legislation and case law on input tax evidence, see De Voil Indirect Tax Service V3.415.

Evidence for VAT recovery ― the basics

For input tax to be recovered, evidence of a VAT recovery entitlement must be held. HMRC will not simply take at face value a taxpayer’s claim to have incurred VAT on costs.

The normal form of evidence is a valid VAT invoice. This is appropriate when VAT is incurred on UK supplies of goods and services. Different evidence requirements apply to the recovery of import VAT and reverse charge VAT.

Where the normal forms of evidence are not available, HMRC has discretion to accept alternative evidence. HMRC should give reasonable consideration to alternative evidence but caution is advised given this power is discretionary.

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