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HMRC internal manual

VAT Assessments and Error Correction

Demand for VAT: Recovering a debt to the Crown: Definition of an unauthorised person

Section 67(2) of the VAT Act 1994 defines who is not authorised to issue an invoice:

67(2) says

‘67(2) In subsection (1)(c) above, “an unauthorised person” means anyone other than-

    (a) a person registered under this Act; or

    (b) a body corporate treated for the purposes of section 43 as a member of a group; or

    (c) a person treated as a taxable person under regulations made under section 46(4); or

    (d) a person authorised to issue an invoice under regulations made under paragraph 2(12) or Schedule 11; or

    (e) a person acting on behalf of the Crown.’

Practical definition

In practice an unauthorised person will normally mean a person who has issued an invoice charging as sum as VAT:

  • while not registered for VAT because they are below the registration threshold;
  • after deregistration;
  • prior to the date on which they become liable to be registered; or
  • farmers not certified to use the flat rate scheme who issue a flat rate scheme invoice.

Traders who exceed the turnover threshold and thus become liable to registration should be considered for Belated Notification Penalty.