Why the registration date matters
VAT can only be reclaimed by a registered business, on supplies made to it on or after its effective date of registration (with limited pre-registration exceptions). A newly formed company spends weeks unregistered: every purchase in that window carries VAT it cannot recover until the certificate arrives, and services bought more than six months before registration are lost altogether.
A shelf company’s effective date is already in the past. Some of the companies we sell have been registered since 2020. From the moment the company is transferred, every VAT invoice addressed to it is input tax it can claim on the next return.
The timeline after transfer
Day 1. The company is transferred into your name and the document pack arrives with the VAT number, the effective date of registration and the return periods.
Days 1 to 5. Notify HMRC of the change of control, principal place of business and bank account. Register the new director for Government Gateway access to the VAT account, or appoint your accountant as agent. Start keeping VAT records in software that meets Making Tax Digital rules; the company must file through compatible software.
During the quarter. Make the company’s purchases in the company’s name, with VAT invoices addressed to it. Where the company imports goods, use its EORI and select postponed VAT accounting so import VAT is dealt with on the return rather than paid at the border.
End of the quarter. The return covers all sales and purchases in the period. If input tax exceeds output tax, the return is a repayment claim. File as soon as the period ends; waiting until the deadline only delays the money.
Within about 30 days of filing. HMRC aims to pay repayments within 30 days. Where the first claim is checked, expect a request for the invoices behind the largest figures. Answer promptly and the repayment follows.
A worked example
A buyer takes over a company on 10 November whose VAT quarters end in December, March, June and September. In November and December the company buys £60,000 of stock plus VAT of £12,000 and makes £20,000 of sales plus £4,000 output VAT. The December return, filed in early January, shows a net repayment of £8,000. Filed on 5 January, that repayment would be expected by early February.
Had the same buyer formed a new company on 10 November and applied for VAT, the application might still be with HMRC in January; the stock bought in November would carry VAT that could not be claimed until the certificate arrived and, if the effective date were set later, might never be recoverable in full.
What can slow the first repayment
- Invoices not addressed to the company, or missing the supplier’s VAT number
- HMRC not yet holding the company’s new bank details, so the repayment cannot be paid
- No Government Gateway access set up for the new director or agent, so the return cannot be filed
- A first repayment claim that is large relative to the company’s sales, which invites a verification check; this is routine and clears with documentation
- Returns filed late, which also triggers late-submission points under HMRC’s penalty system
Keep the company in good standing
A VAT registered company must file every return, including nil returns for quiet quarters, and must keep digital records. If the company stops trading or no longer needs its registration, deregister properly rather than letting returns lapse. We can continue to act for the company after the sale with registered office, nominee and filing services, and can refer you to an accountant if you need VAT returns handled.
Related: shelf company vs new VAT registration · companies with an EORI number · current stock
Questions about this service
Can the new owner reclaim VAT on purchases made before buying the company?
Only purchases made by the company itself count. Costs you incurred personally or through another business before the transfer are not the company's input tax. Once the company is yours, VAT on what the company buys for its taxable activity is reclaimable on its returns in the normal way.
How often does the company file VAT returns?
Most companies file quarterly. Each return is due one calendar month and seven days after the end of the period, and any VAT due is paid by the same date. The company's existing stagger (which months its quarters end) continues after transfer; we tell you the dates with the document pack.
How long does HMRC take to pay a repayment?
HMRC aims to pay repayment returns within 30 days of receiving them. First repayment claims from a company whose ownership has just changed are sometimes selected for a check, which can add a few weeks and a request for invoices. Keeping clean records from day one is the best protection.
Do I need to tell HMRC the company has changed hands?
Yes. The company must update its principal place of business, bank details and contact details with HMRC, and the new director should set up Government Gateway access to the company's VAT account. We explain each step in the transfer pack.
Last updated 9 November 2026.