In this section:
- Visits by VAT inspectors
- VAT investigations and prosecutions
Visits by VAT inspectors
VAT officers are responsible for the collection of VAT for the government. They visit businesses to make sure that their VAT records are up to date. They examine VAT records, question the business owner or the person responsible for the VAT records and watch business activity. They also check that amounts claimed from or paid to the government are correct.
Each visit may take anything from several hours to several days, depending on the complexity of the business. This guide explains why VAT inspection visits are necessary, how they are arranged and what happens during a visit. It also explains what you need to do to prepare for a visit, what you need to do while it is taking place and what happens afterwards.
On this page:
- Your responsibilities
- Why do we make VAT inspection visits?
- Practical aspects of visits
- How visits are organised
- How you can help us
Your responsibilities
If your business is VAT registered, you are responsible for accounting for VAT and duties correctly. You are also responsible for making any VAT payments due on time.
To keep proper VAT accounts, you need to obtain, issue and keep various documents - including receipts and suppliers' invoices. You do not have to keep records in any set way, but they must be complete and up to date. They must also be easy for VAT officers to inspect, and the figures that you have used to fill in your VAT return must be easy to find. Usually, your normal business records can be adapted quite easily to provide this information.
If a VAT officer does not find any mistakes in your records during a visit, you must not assume that this means you are accounting for VAT and duties correctly. You are still responsible for ensuring that you keep your accounts correctly and are making the correct payments.
Read our guides on keeping records, invoicing and accounting for VAT
Why do we make VAT inspection visits?
We make VAT inspection visits as part of the checks we make that you are paying us the correct amount of VAT. VAT officers also use their visits to make sure that your accounting and record keeping is accurate and up to date.
VAT officers can offer you help and guidance during their visit. You shouldn't hesitate to ask them questions on anything you're unsure about, but there's no need to wait for a visit to do this - you can contact us at any time.
In some cases, a VAT officer may not need to visit you, but instead will contact you by telephone or in writing to resolve specific queries about your management of VAT. They may ask you for further information, such as your annual accounts, or ask you to fill in a questionnaire, and might give you a time limit to respond.
Practical aspects of visits
How often VAT officers visit you will depend on the size and complexity of your business and on your ability to meet VAT requirements in the past. If you have previously submitted late or incorrect VAT payments or declarations, then VAT officers will visit you more often.
Visits vary in length. If you are a small business, your visit might only last a few hours. If you are a large or complex business, they might take two or more days. If you can provide the relevant records and help VAT officers to understand them, that will help to speed things up, especially if there is anything special or unusual about your business.
Generally one officer will visit, but may be accompanied by a colleague to speed the visit up, or to cover a different area of VAT. Occasionally the officer may be accompanied by a colleague in training.
You might also be visited by a senior officer, to check that the first officer carried out their duties correctly.
Who the VAT officer will want to meet
When VAT officers visit, they will want to talk either to you or to the person in charge of your tax or duties. If there is another responsible person who can answer any questions and provide further information about VAT, then you will not need to be present throughout the visit. However, at the end of the visit, the VAT officer will want to discuss any findings with you.
If you have a professional adviser who helps with your business, then you need to decide whether they should be present during a visit. If they are the best person to explain your business accounts, or deal with a difficult problem, then it would be helpful if they could be present.
Where the VAT officer will want to visit
VAT officers normally visit you at your main place of business. This allows them to:
- get a better picture of your business
- answer any queries you have
- examine your records with as little disruption as possible to your business
If you do not keep your VAT records at your main place of business, you should tell us when we make the appointment for the visit. The VAT officer can then tell you which records they need to see, or agree to examine them somewhere else. But even if the VAT officer examines your records in a different location, they may still want to visit you at your main place of business to discuss your business and see your premises. This won't always be necessary - if, for example, your principal place of business is your home, and your work is that of a computer consultant or similar, the VAT officer may agree to meet you at your accountant's premises instead.
How visits are organised
Before a visit, we will confirm the following details with you:
- the person the VAT officer wants to see
- a mutually convenient appointment date and time
- the name and contact number of the officer carrying out the visit
- which records we need to see, and for which tax periods
- how long the visit is likely to take
- any matters you are unsure of, so that the officer can be better prepared to answer your queries
We can confirm all the above information in writing, if you want.
If you need to postpone a visit, you must give us as much notice as possible so we can make alternative arrangements. In some cases, VAT officers will visit without first making an appointment. If they do this, they will explain why when they visit you.
What happens during a visit
When a VAT officer arrives, they will identify themselves by name and produce a card, and explain why they're there. They'll be as quick and efficient as possible in order to keep disruption to a minimum.
First, they'll want to begin by discussing various aspects of your business with you. They'll then examine your business records and, where appropriate, inspect the premises and any goods on the premises.
They will also take details - where appropriate - of supplies made to you or by you. This is so they can check the correct tax treatment in your suppliers' or customers' records. On some occasions, this will be the main purpose of the visit. If this is the case, the VAT officer will say so when making the appointment.
At the end of the visit, the VAT officer will:
- review with you the work carried out during the visit
- explain any areas of concern they have identified, discuss them with you and agree any future action needed
- explain any adjustment they need to make to the tax or duties payable, agree it with you as far as possible and explain how it will be made
- tell you if you have overpaid or underpaid
If you disagree with a decision, first discuss it with the visiting officer. In any case, they'll tell you how to get a review of the assessment or how you can appeal against it if you disagree with it.
Remember that even if a VAT officer does not find any mistakes in your records during a visit, you must not assume that this means you are accounting for VAT and duties correctly. The officer will not normally have time to examine all of your records, so it will still be your responsibility to ensure that correct accounts are kept and that the correct payments are made.
Read our guide on appealing against VAT decisions
What happens after the visit
Afterwards, we'll write to you with a summary of the visit, along with any rulings, agreements or recommendations. However, this will only happen if you or we think it's necessary. If you disagree with any decisions - or if there are any matters still unresolved - we will give you a reasonable amount of time to provide further information or comment.
If you think that an officer has exceeded his or her authority or acted improperly, you can ask for an explanation. If you're not satisfied and wish to complain, the most direct way is to write to the Head of Region responsible for your local office.
Read our guides on keeping records, invoicing and accounting for VAT
How you can help us
During the visit, the most obvious way to help us is to help us understand your business and records, and to co-operate fully with the VAT officer. In fact, if you refuse to show the VAT officer the records they want to see they can use formal powers to obtain them - if they can demonstrate that the records are relevant to the area they're dealing with. If you want further explanation, you should contact the officer's manager. The officer will provide their manager's contact details if you ask for them.
If there are any significant changes in the tax or duties you have declared, or the systems used to calculate the declarations, it helps to tell us why as soon as possible. You can do this by contacting us.
Apart from that, the best way of helping is:
- keep your records, accounts and payments up to date
- contact us whenever there's anything you're unsure about
- provide us with the information we request within the specified time
Read our guides on keeping records, invoicing and accounting for VAT
