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HMRC internal manual

VAT Traders’ Records Manual

Other Invoicing arrangements for particular businesses: Cash and carry wholesalers: Action on visits to customers

If these arrangements are to operate satisfactorily, it is essential that traders who buy from cash and carry wholesalers hold and keep product-coding lists. Without a coding list the till-roll invoices will be largely meaningless, and it will not be possible for the trader to demonstrate his entitlement to input tax deduction. When you visit traders who make cash and carry purchases you should ask for product coding lists to see whether up to date lists are held.

The onus is on the customer to supply evidence of VAT charged on a taxable supply to him for the purpose of his business. But if you find that a customer has difficulty in obtaining an up to date coding list, you may have to take up the matter with the local office for the supplier. Traders who do not possess the requisite code lists are to be warned in writing that failure to produce these lists when required to do so may result in input tax deductions being disallowed.

You should also take the opportunity to remind the trader that, in claiming deduction of VAT shown on these till-roll invoices, they must exclude purchases made for their own private purposes, or made by friends and associates to whom they may have lent their buying cards for their personal purchases.