When you register for VAT there will be a crossover period between submitting your application for VAT and getting your VAT number from HMRC.

You can’t charge or show VAT on your invoices until you get your VAT number. However, you will still have to pay the VAT to HMRC for any sales you make in this period.

So how do you invoice and account for this?

Registering for VAT

When you register for VAT, you’ll be sent a VAT registration certificate. This confirms:

• your VAT number
• when to submit your first VAT Return and payment
• your ‘effective date of registration’ – this being the date you went over the threshold or the date you asked to register if it was voluntary. This is also the date from which you are liable for VAT on your vatable sales whether you have charged it on to your customers or not – which is why it is important to get this right

Invoicing before your VAT Number arrives

You could wait until your VAT number is confirmed before you invoice your sales. We don’t recommend this – the sooner you invoice – the sooner you are likely to be paid.

Actually it’s very simple, you increase your prices to allow for the VAT and tell your customers why. So for example,  if you would have charged a customer £100 for a product that’s standard-rated for VAT, you increase your price by 20% and charge them £120.

Confirmation of your VAT registration number

Once you have your VAT number you can then reissue the invoices showing the VAT so your customer can reclaim the VAT on their purchase from you. 

Invoicing after your VAT Number arrives

Once you are registered for VAT and your VAT number has been confirmed, all sales you make that are subject to VAT must be issued on proper VAT invoices.   See: Information required on a VAT invoice.