According to UK law, a company cannot operate if its VAT taxable turnover exceeds certain thresholds (£85,000 for VAT registration). In this article we will learn about how to check if a company is vat registered.
VAT thresholds
A business may have trouble determining if a competitor is VAT-registered. Relax! DNS accountants can determine if a company is VAT-registered. A business can verify a new supplier or customer's value added tax registration number (VRN) in two ways: Businesses can call HMRC's VAT Helpline or use the European Commission's online VAT Information Exchange System (VIES). Let's clarify.
HMRC VAT Helpline
Businesses can call 0300-200-3700 to verify a VAT registration number (the call can be made anytime between 8am and 8pm throughout the week). This method has limits. HMRC can only verify UK-registered businesses' VAT numbers. The VAT Helpline's limited hours can also be problematic for UK businesses. The business may want to inquire about the VAT number outside the helpline's working hours, or it may take time to speak with a staff member.
Online VAT Information Exchange System (VIES)
Businesses in the UK can call HMRC's VAT helpline or use the VAT Information Exchange System's online VAT number validation service (VIES). The VIES portal (managed by the European Commission) helps businesses verify EU VAT registration numbers. The VIES portal uses real-time data feeds from all member states' VAT systems in the UK to provide up-to-date information. VIES was created to combat the growing threat of 'carousel fraud,' in which innocent individuals and businesses in the UK are trapped in a chain of fraudulent transactions.
DNS Accountants in Harrow can help you access the European Commission's VIES to authenticate a VAT number. Once a business opens VIES, they can use the drop-down menu (member-state & VAT number and requester member state & VAT number). The business will provide country-specific details and its VAT registration number for verification. The website tells the business if the number is valid. According to VIES, "Businesses can confirm the legality of a VAT number issued by any Member State by selecting the Member State and entering the VAT number to be validated." If it's a valid VAT number, the VIES portal will provide the business's name and address.
VAT number dropdown
The first two alphanumeric characters of a VAT number represent the business's country of registration. All EU countries use two-letter codes.
Austria (AT), Belgium (BE), Bulgaria (BG), Cyprus (CY), Czech Republic (CZ), Germany (DE), Denmark (DK), Estonia (EE), Greece (EL), Spain (ES), Finland (FI), France (FR), United Kingdom (GB), Hungary (HU), Ireland (IE), Italy (IT), Lithuania (LT), Luxembourg (LU), Latvia (LV), Malta (MT), The Netherlands (NL), Poland (PL), Portugal (PT), Romania (RO), Sweden (SE), Slovenia (SL) (SK)
Businesses should check if a UK VAT number has 9 digits (excluding the country code (GB)). The first 7 digits are unsystematic, and the last 2 are derived from them.
Annual reports, company accounts, and confirmation statements cost £1 each. For these documents, a UK business must register. UK businesses can pay by credit/debit card or PayPal.
Why is VAT number crucial?
Businesses in the UK can only claim VAT on supplies with a valid VAT invoice. On a valid VAT invoice, the name and address of the business, an auto-generated exclusive invoice number, the company's VAT registration number, a description of the goods or services, and the date of payment must be included (creditor turnover period). Before claiming VAT, a company should make sure all the above details are on the invoice. Verify the supplier's VAT number when reclaiming a large amount of VAT. Businesses that don't follow the guidelines may have trouble reclaiming VAT from HMRC.
Accountants DNS
DNS Accountants is a UK-based business. The company offers tax and accounting services to plc, llc, freelancers, and contractors. Our team offers:
Year-round tax adviceAccountant with direct phone and emailRegular bookkeeping and access to NomismaPersonal tax returns, VAT returns and filings, PAYE payments and adviceHandling HMRC correspondence, Company House formation, and customer bank account openingDNS Accountants validate VAT invoices so businesses can reclaim VAT. Valid VAT invoices must include:VAT amountDateProduct/service detailsSupplier's addressVAT numberVAT-excluded costBilling number