V5.256 Verification of input tax

V5.256 Verification of input tax

Input tax is calculated from the purchases, imports and acquisitions recorded in a person's accounting records. Verification of the amount of input tax is, at least in theory, a simpler matter than that of output tax since, with certain minor exceptions1, any input tax claimed is, by definition, a specific amount and should be supported by documentary evidence2. HMRC officers are therefore concerned to ensure that all invoices and equivalent documents are held, and are valid.

Invoices wholly or partly invalid

The decided cases indicate that VAT invoices do not of themselves give rise to input tax credit – they merely provide evidence of a claim for credit which is properly due. They also indicate that an otherwise valid claim for input tax credit can fail due to deficiencies in the documentation recording it. The following general conclusions are drawn:

  1.  

    •     A claim for input tax credit must arise in respect of a supply made to a taxable person and used for business purposes3; see V3.401. It follows that, if called upon to do so, the claimant must demonstrate that the supply purported to be evidenced by the VAT invoice has been made by the person who issues

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