Not VAT registered but can claim VAT back

I have just set up an account so new here. I have selected not VAT registered we are government run although we can claim VAT back. Could anyone give me advice please. Have I done the correct option? and how do I process purchase invoices with the VAT on? Thanks

Only way to do that would be to enable vat settings but make all your invoices marked as no vat.

The issue here is whether your income is out of scope for vat or just zero rated.

If its out of scope then it shouldn’t be included in any vat return, so you’ll need to mark it as such. However if your just zero rated you can just apply no vat and reclaim the vat expenses as usual.

Thanks Paul, it’s public funding run but we do not earn enough to be VAT registered but can claim VAT back on purchases. We do not have a VAT number. So I’ve set up this account as no VAT. How should the account be set up and also if it should VAT can I now go back and change that to VAT account but zero rate on invoicing?

You can enable the vat settings. You may need to enter a fake vat number to get it to work. I don’t know to be honest.

Then you can edit the details and change it to add the vat.

How does that work? You don’t earn enough to be required to be VAT registered but how are you claiming purchase VAT without registering voluntarily? Or do you get the VAT back from your funding body rather than from HMRC?

As Paul says you probably want to enable VAT accounting within QuickFile but not the online filing option, record your sales as no VAT, record your purchases with VAT, and save your quarterly VAT returns in QuickFile to generate the figures that you use for your reclaims. When you receive the refunded VAT you’d tag that as a VAT refund in the normal way.

You will get a VAT column on your invoices, though it’ll always be zero, you might be able to hide that with some custom invoice CSS so it doesn’t confuse your customers.

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