VAT on PayPal receipts

da_rule

I am looking at starting up a business which has the potential to be quite high turnover and potentially trigger VAT registration (although I kind of hope it doesn't).

I am looking at using PayPal to process online payment. I know that PayPal will send receipts to my customers. My question is, should I become VAT registered, is there anyway that the PayPal receipt could contain my VAT registration number? Or would it be a case of me having to send my customers a separate VAT receipt? But does this then mean that customers (specifically business ones) could cheat HMRC by claiming the two separate receipts as separate transactions?

InsideInsurance

Businesses could cheat HMRC by randomly making up invoices and to be honest is really your concern.

Dont know if PayPal can do VAT receipts for you. A quick look through my inbox I cant see any of my recent purchases that do this but do have VAT invoices/ receipts from the companies themselves.

Aquamania

VAT registered sellers usually issue their own VAT invoices - you'll see them identified on ebay etc.

I don't think you can do it by paypal (they can issue a non VAT compliant invoice). The VAT invoice needs to be numbered, preferably using a sequential number so the VAT man can see all the ones you issue, and more importantly, any that appear to be missing. Paypal doesn't do this, afaik.

VAT registered customers can only reclaim vat against compliant VAT invoices, so no they can't claim it against the paypal invoice, hence why sellers promote the fact that they offer separate VAT invoices where they can.

System

I only send customers a VAT receipt if they ask for it

Cardinal-Red

I would be 99% sure that the receipt issued by Paypal is for the payment and is not an invoice in the VAT sense.