What is the Purpose of the VAT 126 Report?
The purpose of the VAT 126 Report for Parish and Town Councils is to assist in reclaiming purchase tax on expenditure for non-business activity when the council is not registered for VAT. VAT Notice 749 provides further details on VAT for Local Councils.
When can I reclaim VAT?
You can recover the VAT you have incurred on your non-business activities only if you:
1. Place the order
2. Receive the supply
3. Receive a VAT invoice addressed to you
4. Pay from your own funds (including funds awarded to you, for example, lottery funds)
What details do I need to include on VAT Form 126?
The following details are required on your VAT Form 126:
- The invoice date
- The supplier’s VAT registration
- The VAT amount
- The name of the organisation receiving goods or services on the invoice
- A brief description of goods or supplies
If you’re claiming a refund for more than 5 invoices, you’ll need to upload one spreadsheet or document providing the details above for all invoices.
Here is an example of how your VAT claim schedule can be structured.
- You must claim to complete calendar months.
- If the amount of VAT to reclaim is less than £100, the VAT claim must be annual.
How to submit a VAT 126 Claim
You can submit your VAT claim online at https://www.gov.uk/guidance/claim-a-vat-refund-as-an-organisation-not-registered-for-vat via the "Claim Now" button. You will need to log in with your Government Gateway ID and password.
You can submit a VAT claim via post if it is your first time making a VAT claim, or if you're unable to make a claim online. You will need to complete the VAT 126 Form, print and post to HMRC.
VAT Form 126 and Scribe
Scribe will produce your VAT Form 126 report, including all the details required by HMRC. Specific date ranges can be applied before running the report.
The report will show all transactions with a VAT element, the supplier name and description. It will also populate the invoice date entered against the payment, as well as the VAT registration number entered against the supplier.
This can then be downloaded in your desired format, and attached when submitting your claim.