Repayment VAT returns will often trigger some questions from HMRC prior to refunds being approved and released. It is generally the case that HMRC does query the first VAT return of a newly VAT registered entity when that return reports a VAT refund is due. Enquiries can also arise if a VAT repayment return is submitted by a taxpayer that normally has a VAT liability to pay. It is prudent to be prepared for HMRC making contact to reduce the waiting time for the VAT refund to come through. Any delay in HMRC paying the VAT refund can cause unwanted cash flow problems.
Source: saffery.com
