1. Who Can Claim VAT Back in the UK?
To claim VAT back, you must:
- Be a VAT-registered business in the UK.
- Have valid VAT invoices for purchases.
- Use the goods or services exclusively for business purposes.
If you’re not VAT-registered, you cannot reclaim VAT.
2. What VAT Can You Claim Back?
You can claim VAT on:
- Office supplies
- Equipment and tools
- Travel expenses (like fuel, parking, tolls)
- Utility bills
- Professional services (legal, accounting)
- Stock and raw materials
You cannot reclaim VAT on:
- Personal expenses
- Business entertainment
- Anything without a VAT invoice
- Most cars used for both personal and business purposes
3. How to Register for VAT
If your business earns more than £90,000 (as of 2025), VAT registration is mandatory. Below that, it’s optional. To register:
- Visit the HMRC website
- Apply online or use an accountant
- Receive your VAT number and VAT certificate
4. How to Claim VAT Back on Your Return
You claim VAT back by submitting a VAT return, usually quarterly. To do this:
- Log into your HMRC VAT account.
- Enter total sales and purchases, showing VAT charged and paid.
- Deduct the VAT on purchases from the VAT on sales.
- Submit the return by the deadline.
If you paid more VAT than you charged, you’ll receive a refund.
5. How Long Do You Have to Claim VAT?
You must claim VAT within four years of the date of the invoice. Keep all records and receipts as proof in case of an audit.
6. Common Mistakes to Avoid
- Claiming without a valid VAT invoice
- Mixing personal and business expenses
- Missing deadlines
- Not keeping digital records (required under Making Tax Digital)
Frequently Asked Questions
Can I claim VAT back before registration?
Yes, on certain goods (up to 4 years old) and services (up to 6 months old) used for the business.
How long does a VAT refund take?
Usually within 10 working days after HMRC processes your return.
Do sole traders need to register for VAT?
Only if turnover exceeds the threshold or they choose to voluntarily register.
What is Making Tax Digital?
A UK government initiative requiring businesses to keep digital VAT records and file returns using approved software.
Can I claim VAT on fuel?
Yes, if it’s for business use. Use a fuel scale charge if the vehicle is used for both personal and business purposes.
Conclusion: Claiming VAT Back the Right Way
Claiming VAT back in the UK can significantly reduce your costs—if done correctly. Register, keep valid receipts, understand what qualifies, and file your returns on time. With the right approach, VAT reclaims become a smooth part of managing your business finances.