VAT Records & Statutory Records

Businesses must keep certain records to support VAT returns and demonstrate that the correct VAT treatment has been applied. Accurate records help businesses prepare returns, support repayment claims and respond to HMRC questions.

This page explains the importance of maintaining VAT records and statutory records, and how good record keeping can help businesses demonstrate compliance with published HMRC guidance.

Key Points

• Keep a VAT account and VAT return workings.
• Retain purchase and sales invoices.
• Keep credit notes and debit notes.
• Retain bank statements and payment evidence.
• Keep import and export records where relevant.
• Ensure records are organised and readily accessible.

What records must be kept
The VAT account
Purchase and sales invoices
Import and export documentation
Digital records and Making Tax Digital
Record retention periods

What Records Must Be Kept

Businesses must keep sufficient records to support the information reported on tax returns and demonstrate compliance with statutory obligations. Depending on the nature of the business, this may include invoices, receipts, bank records, accounting records, payroll information and documents relating to specific transactions.

The VAT Account

The VAT account is a summary record showing how VAT figures have been calculated for each VAT Return period. It should record VAT charged on sales, VAT incurred on purchases and any adjustments made. Maintaining an accurate VAT account helps support the preparation of VAT Returns and compliance with HMRC requirements.

Purchase and Sales Invoices

Purchase and sales invoices form an important part of a business’s statutory records. These documents provide evidence of transactions and support VAT recovery claims, accounting entries and tax return submissions. Businesses should ensure invoices are retained and can be produced when required.

Import and Export Documentation

Businesses involved in international trade should retain relevant import and export documentation, including customs declarations, shipping records and evidence supporting VAT treatment. These records may be required to demonstrate compliance with customs procedures and support zero-rated or other VAT treatments.

Digital Records and Making Tax Digital

Making Tax Digital requires certain VAT-registered businesses to maintain digital records and submit VAT information electronically. Digital record keeping can help improve accuracy, reduce administrative burdens and support compliance with HMRC’s digital reporting requirements.

Record Retention Periods

Business records should be retained for the periods required by legislation and HMRC guidance. Keeping records for the appropriate length of time helps businesses support tax returns, respond to compliance checks and provide evidence where historical information is requested.