Everything you need to know about VAT numbers


Everything you need to know about VAT numbers



Value added tax identification number is commonly called the VAT number and it is a form of identification used in many countries for the purpose of value added tax.


How to verify VAT details using VIES

The VAT number can be found and verified online on the EU’s official website called VIES which is also called EU VAT checker but many national governments unlike those in EU do not openly share VAT numbers because it goes against the data protection laws. But in the European Union the VAT number confirms that the number is allocated and in use and can be used to find out the name and other identification details of the person to which number has been allocated. The UK VIES database is updated monthly and it consists of details of all VAT registered businesses unless the business is very new and hence not included. If you are not able to find the number on VIES or VIES suggests that the number is invalid then check again with the business in question. Either the contact person of the business in question hasn’t filled it properly or you have made a mistake in noting it down. But if you still don’t get the result you were expected and you are sure that no mistake has been made then you should contact the VAT helpline of the HMRC and they will find out whether the company’s details match with the  details you have provided. If the VAT details do not match then beware because it could be a fraudulent entity and you would be better off finding another business to work with.


Format of VAT numbers

Let us now talk about VAT numbers and their format.Most of the time countries only have numeric values in the VAT number but in some countries the VAT identification is alphanumeric. This identification number is unique for every taxable person or business and also for non taxable entities which are registered for VAT.


Now comes the question of who needs to have a VAT number.


Who needs a VAT number

The answer is that most businesses and persons who are conducting economic activities need a VAT number. Talking in particular the first kind of businesses which need a VAT number are those which carry out supply of goods and services which are taxed with VAT. Secondly, businesses which make an intra acquisition of goods also need a VAT number. Third kind of businesses that require a VAT number are those which receive services on which they have a VAT liability under Article 196 VAT directive. The last kind of businesses that need a VAT number are those which supply services for which the customer ought to pay VAT under article 196 of the VAT directive.


Are VAT numbers nation specific or not

The answer is a resounding yes.VAT numbers are nation specific.


Who issues a VAT number

The answer is that only tax administrations have the right to issue a VAT number and you should contact the relevant tax administration if you are getting unsolicited and suspicious messages.


I would like to conclude with saying that VAT numbers are important because they identify the tax status of the customer and the place of taxation.