What Is a VAT Receipt?

If your business is VAT registered, keeping proper records is essential for compliance and reclaiming VAT on expenses. One of the key documents you’ll need is a VAT receipt. This simple but important piece of paperwork proves that VAT was charged on a purchase and gives HMRC the evidence needed to support a claim.

This guide explains what a VAT receipt is, when you need one, what it should include, and what happens if your documentation is incomplete.

What Is a VAT Receipt and Why Do You Need It?

A VAT receipt, sometimes called a VAT invoice or VAT evidence, confirms that VAT was applied and paid on a sale. It’s issued by a VAT-registered business to a customer and is a legal requirement for businesses that charge VAT on taxable supplies.

As a customer, especially if you’re VAT-registered, you’ll need a valid VAT receipt to reclaim input VAT through your VAT return. Without it, HMRC may disallow the deduction, even if the purchase was legitimate.

What Should the VAT Receipt Show?

To be considered valid for VAT purposes, the receipt must include specific details. There are two types of VAT receipts, depending on the value of the transaction.

For purchases under £250 (simplified VAT invoice):

• Seller’s name and address

• Seller’s VAT registration number

• Date of supply

• Description of goods or services

• VAT-inclusive price

• VAT rate charged

For purchases over £250 (full VAT invoice):

• All of the above, plus:

• Invoice number

• Customer name and address

• Net amount

• VAT amount separately itemised

• Total amount payable

• Time of supply (if different from invoice date)

If you don’t receive a VAT receipt automatically, you’re entitled to ask the supplier for one.

What Proof Do You Need to Reclaim VAT?

To reclaim VAT on business expenses, you must have:

• A valid VAT receipt (as outlined above)

• Evidence that the purchase was for business purposes

• A record of payment (e.g. bank statement or card transaction)

You cannot claim VAT on purchases for personal use, and any errors or missing documentation could lead to your claim being rejected during a VAT inspection.

For digital purchases or online services, electronic invoices are acceptable as long as they include all the required information.

Getting a VAT Receipt

Most VAT-registered suppliers provide a VAT receipt automatically. If not, you can request one. If a seller refuses to issue a VAT invoice and you believe VAT was charged, that may raise concerns over compliance or possible fraud.

Always ensure:

• The supplier is VAT registered (you can check VAT numbers using HMRC’s online checker)

• You retain a clear copy of the receipt in your records for at least 6 years

This is especially important for businesses under Making Tax Digital (MTD) rules, where digital record-keeping is required.

Financial Penalties for Incomplete Records

If HMRC inspects your business and finds that you’ve reclaimed VAT without proper receipts or used incorrect invoices, you may face:

• Repayment of overclaimed VAT

• Interest and penalties

• Longer or more frequent VAT inspections

Failing to keep valid records can be costly, even if the expenses were genuine.

Final Thoughts

A VAT receipt is more than just a standard till slip – it's an essential proof that VAT was charged on a transaction. If you're VAT registered and planning to reclaim VAT on purchases, it’s your responsibility to keep correct records.

Make sure every VAT receipt you receive includes the right information, and always double-check VAT numbers if in doubt. Doing so keeps you compliant, helps avoid HMRC penalties, and ensures your VAT claims are accurate and justified.