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HMRC internal manual

VAT Registration

From
HM Revenue & Customs
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Registration in respect of relevant supplies: effective date of registration

Where a person makes relevant supplies

VAT Act 1994, Schedule 3A, paragraph 3(2) provides that the EDR for a person who is liable to be registered because they are making relevant supplies will be the date that the person first made a relevant supply.

For example, on 22 April a trader makes a relevant supply (and there had been no reasonable grounds for believing that he would do so).

Trader makes a relevant supply 22 April
   
Trader becomes liable to be registered (EDR) 22 April
Trader must notify liability by 22 May

Where a person believes he will make relevant supplies

VAT Act 1994, Schedule 3A, paragraph 4(2) provides that the EDR for a person who has reasonable grounds for believing they will make a relevant supply in the next 30 days will be the day the reasonable grounds first existed.

For example, on 22 April the trader has reasonable grounds to expect that he will make relevant supplies in the next 30 days.

Trader forms the expectation that he will make relevant supplies in the next 30 days 22 April  
     
Trader becomes liable to be registered (EDR) 22 April  
Trader must notify liability by 22 May  

To establish whether there were reasonable grounds to believe that a relevant supply would be made in the next 30 days alone, you should be looking for evidence such as a business plan, a contract, or an agreement with another party. Although the lack of case law makes it difficult to define ‘reasonable grounds’ under these provisions, it is unlikely that a person could argue that he did not expect to make a relevant supply.