I recently applied to register a newly formed LTD for VAT. The answer came back "prove you are making taxable supplies". This was a newly formed company with no transactions no contracts etc. etc. I wrote to them and explained butt no avail. It is impossible to get through to the registration department on the phone because it is always engaged (they probably take the phone off the hook). A complaint, as you would expect, yielded nothing because they cover for each other unless it is completely indefensible.
By coincidence I am dealing with a company which was formed fraudulently and the VAT people registered it without batting an eyelid.
has anybody else had this kind of tom foolery?
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Tom foolery?
This is my common experience and I think this is the normal approach that the VAT unit follow, and it a level of due diligence that I think is correct and proportionate.
We usually just provide a proforma invoice (or occasionally a contract or appointment letter) and the VAT number is issued very quickly, allowing the correct invoices to be raised.
Why would a complaint be in order, and why do you think it is indefensible?
I have always found the VAT unit to be pretty good, and it seems to be that you are being a bit unreasonable if you think they cannot ask you to demonstrate that the company is making taxable supplies.
@Tim
My understanding was that you had to be making - or intending to make - taxable supplies.
Is this not the case?
I was going to register a new business tomorrow who won't be making taxable supplies for a few weeks but who are certainly making VAT inclusive purchases
Intending traders
My understanding was that you had to be making - or intending to make - taxable supplies.
Is this not the case?
You can certainly register intending traders for VAT, we had no end of property companies (who had bought a property and were altering/renovating it prior to a sale) who didn't see any turnover at all for sometimes over a year. We always registered them from day 1 so they could recover VAT as they went along.
HMRC always registered them, though they sometimes got a little edgy after a while and asked for evidence they intended to trade (which we then provided, along the lines of paperwork showing negotiations etc...).
I suspect though that the fact the client opted to tax the property helped here, as it was HMRC held evidence that a VAT'able sale was intended later.
Tempted
I'm tempted to tell them to pop over from Wolverhampton and see for themselves.
More realistically, I apply immediately after the first sale and send a copy of the invoice. If they're retailers, I can't see a situation where I'd register from day one.