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How to Keep VAT Records UK

As a rule, VAT record keeping is part of running a business in the United Kingdom. This section explains how to keep records for VAT including invoices and a VAT account.

KEEPING VAT RECORDS: Running a VAT registered business means you need to keep VAT records.

VAT bookkeeping relates to the tax portion on all business purchases and all sales.

The business also needs to keep a Vat account. This is a separate summary of all Value Added Tax transactions.

Any time a business issues VAT invoices to customers the invoice must have the correct tax amount on it. UK businesses need to keep VAT records for at least six years.

Note: The exception is for those that use the VAT MOSS service. In this case, the business would need to retain the records for 10 years.

Vat records can be on a computer as individual items or kept as bookkeeping software. Old fashioned paper records are still allowed in the United Kingdom. But the records that get kept must be readable, accurate, and complete.

It is not always possible for a small business to keep paper records off-site. Even so, the business should take all reasonable measures to secure them. Electronic records should get backed up at least once a month and then held off-site.

If a VAT invoice is mislaid you should request a duplicate from the supplier. Have the replacement invoice marked as ‘duplicate’. The same applies to any invoices that get damaged and become unreadable.

Note: HM Revenue and Customs can inspect how businesses are keeping VAT records. They will fine a company if they find the VAT books are not kept in order. But, you can get help with tax issues if you find VAT record keeping difficult and confusing.


VAT Invoice Rules

Only businesses registered for Value Added Tax can issue a VAT invoice. Find out how to issue valid VAT invoices and why you need to keep copies of all business invoicing.

VAT Record Rules

Businesses must keep VAT records as well as general business records. Check a list of files and documents your business may need to have available for inspection by HM Revenue and Customs.

VAT Account Rules

A VAT account is a system of recording and separating Value Added Tax data. So, businesses must keep records of the amount of VAT charged on sales and paid on purchases.

VAT Time of Supply

A VAT tax point is the date when Value Added Tax needs charging on a business transaction. Find out how businesses must apply the time of supply (tax point).

VAT Record Keeping Guide for Small Businesses in United Kingdom