Industry sector:

Optician: VAT repayments


VAT repayments may be made to VAT registered businesses if they pay out more in VAT on their purchases ('input tax') than they charge on their sales ('output tax').

This might happen if, for example, you spend a lot on equipping and furnishing your new optical business premises but don't take much money in the first few months of trading. However, note that as an optician you will be making a mix of exempt and standard rated supplies, so under the partial exemption rules, input tax may not be fully recoverable. The Federation of Ophthalmic and Dispensing Opticians (FODO) website includes several guides on VAT for opticians.

VAT registered businesses complete a VAT Return every quarter, setting the amount of VAT paid by the business against the amount owed to HM Revenue & Customs (HMRC). If a repayment is due to you it will normally be paid direct into your business bank account. You can expect to receive your repayment around a month or so after you have submitted the Return claiming it.