When input tax claims fail evidence tests
Why HMRC-style evidence checks reject otherwise legitimate recovery — and how to tighten supplier files.
A purchase can be wholly business-related and still fail a recovery test if the invoice does not carry the right details. Reviewers look for a clear supplier identity, a VAT amount, a description that matches the goods or services, and a date that sits in the claim period.
Common failures include photocopied till receipts without a VAT breakdown, invoices addressed to a director personally, and claims on expenditure that legislation blocks even when the business benefit feels obvious. Cars, certain entertainment, and goods put to private use sit in that second group.
Tighten the process at the point of capture. Ask suppliers for a full tax invoice before payment is released. Train accounts payable to reject lines that lack a VAT number or narrative. Where a receipt is the only document available, decide in advance whether recovery will be claimed at all.
If you discover historic weak claims, document the value and period before correcting. A calm, ordered correction is easier to explain than a sudden swing in the next return with no working papers.