Next steps
Invoice wording templates
These reduce confusion and help avoid implying VAT when you’re not registered:
- Good: “Total price: £1,000 (supplier not VAT registered).”
- Good: “VAT: N/A (not VAT registered).”
- Avoid: “£1,000 + VAT” (implies you will add VAT).
- Avoid: “VAT included” (implies VAT was charged).
- Avoid: showing VAT as a separate line unless you’re registered.
General information only. Not tax/legal advice. If money has already been taken as “VAT”, speak to HMRC or an accountant.
Guide
- You can set any total price you want, but if you’re not VAT registered, it’s just “the price”, not VAT + price. Not sure whether you should be charging VAT at all? Try our Do I need to charge VAT? checker.
- Businesses ask for VAT invoices because they might reclaim VAT, but they can only do that if you’re VAT registered and issue a proper VAT invoice.
- “+ VAT” or “VAT included” wording can cause problems if you’re not registered, because it implies VAT was charged.
- Showing VAT when you’re not registered is an “unauthorised issue” of a VAT invoice. HMRC can make you pay over the amount shown as VAT and charge a penalty on top.
- Once you go over £90,000 of taxable turnover in any rolling 12 months, you must register within 30 days of the end of that month. You can only charge VAT from your effective registration date. Use our VAT threshold calculator to check your rolling total and deadline.
What happens if you charge VAT when you’re not registered?
Showing VAT on an invoice when you aren’t registered is called an “unauthorised issue” of a VAT invoice. HMRC can:
- make you pay over the full amount you showed as VAT, even though you’re not registered;
- charge a penalty on top, which is usually lower if you tell HMRC yourself and correct it quickly.
It isn’t a crime to make an honest mistake, but deliberately charging “VAT” you don’t pass on can be treated as fraud. The fix is the same either way: correct the invoices and speak to HMRC or an accountant about any money you collected as VAT.
Can I claim VAT back if I’m not VAT registered?
No. Only VAT-registered businesses can reclaim VAT on their purchases. Until you register, the VAT you pay to suppliers is just part of your costs.
If you register later, you can usually reclaim VAT on goods you bought up to 4 years before registering (if you still have them) and on services from up to 6 months before. See our VAT refund guide for how that works.
Charging VAT while you wait for your VAT number
Once you’ve applied, HMRC can take a few weeks to send your VAT number, but you owe VAT from your effective registration date. HMRC’s guidance for the gap is:
- Don’t charge or show VAT on invoices until you have your VAT number.
- Increase your prices by the VAT you’ll owe (for example 20%, which our VAT calculator can work out) and tell customers why.
- When the number arrives, reissue those invoices as proper VAT invoices showing the VAT and your number, so VAT-registered customers can reclaim it.
Paying someone who isn’t VAT registered
If you’re the customer, a supplier who isn’t VAT registered should charge you one total price with no VAT. You can’t reclaim any VAT on it, even if you’re VAT registered yourself, because no VAT was charged.
- If their invoice shows VAT but has no VAT number, ask them to correct it before you pay or reclaim anything.
- Check the format of a supplier’s number with our UK VAT number checker, then confirm it’s registered with HMRC’s free Check a UK VAT number service.
- Paying a non-registered supplier isn’t a problem: it’s normal for small businesses under the £90,000 threshold.
FAQ
Can I put VAT on an invoice if I’m not VAT registered?
No. If you’re not VAT registered, you must not show VAT as a separate line or use wording like “+ VAT” or “VAT included”. Instead, charge a single total price and add “VAT: N/A (not VAT registered)” if helpful.
Not VAT registered: how should I write my invoice?
Keep it simple: show one total price. If customers might assume VAT, add a clear note such as “Not VAT registered” or “VAT: N/A”.
Can I claim VAT back if I’m not VAT registered?
Generally, no. Only VAT-registered businesses can reclaim VAT on eligible purchases. If you’re not registered, VAT charged to you is part of your cost. After registering, you may be able to reclaim VAT on some purchases made before registration.
A customer asked for a “VAT invoice”: what do I do?
Explain that you’re not VAT registered, so you can’t issue a VAT invoice and they can’t reclaim VAT from you. You can still supply a normal invoice or receipt showing the total price.
I already wrote “+ VAT” or “VAT included”: how do I fix it?
Correct the paperwork quickly: issue a corrected invoice (or a credit note and new invoice) removing the VAT wording. If you collected money described as VAT, speak to HMRC or an accountant, because HMRC can require that amount to be paid over to them and may charge a penalty.
Should I register for VAT if I’m near the threshold?
Check your taxable turnover on a rolling 12-month basis. You must register if it goes over £90,000, or if you expect it to go over £90,000 in the next 30 days alone. You can also register voluntarily below the threshold.
Is it illegal to charge VAT if you’re not VAT registered?
You must not do it. HMRC treats it as an unauthorised issue of a VAT invoice: you can be made to pay over the amount shown as VAT and charged a penalty. Deliberately keeping money charged as VAT can be treated as fraud.
Can I charge VAT while waiting for my VAT number?
Not on the invoice. Until the number arrives, raise your prices to cover the VAT you’ll owe and explain why to customers. Once you have the number, reissue those invoices as VAT invoices.
Do I pay VAT to a supplier who isn’t VAT registered?
No. A supplier who isn’t VAT registered can’t charge VAT, so you pay one total price and there’s no VAT to reclaim.