NETP input VAT reclaims for past purchases

Hello, I am a UK LTD owned NETP online marketplace seller. We recently received news from Amazon that historical output VATs will be collected. I regret to say that, as a UK LTD company, we did not register for VAT until now because we thought we had a VAT exemption of 85,000 GBP. However, as we have now learned, this exemption does not apply to non-resident NETP sellers(UK LTD owners) like us. (We understand that it is our responsibility to understand this compliance, but unfortunately, even the accounting firms we worked with did not provide us with accurate information on this issue.) Now, historical output VATs will be charged to us by Amazon, but we have paid VAT on all the products we have supplied for sale since 2021. (All our product supply is made with UK-based wholesalers and invoiced in the name of our UK LTD company. Without VAT number.) Considering this situation, we will pay the output VAT of the sales we have made since 2021 and apply for VAT. But do we have a chance reclaim the input VAT of the purchases we have made since 2021 by declaring it to HMRC now? (We have all the record of invoices that we supply since 2021. ) I would like to state again that we understand and accept that our sales without VAT were a mistake. However, constantly changing regulations and the lack of Marketplace guidance made us victimized. We are ready to pay the penalty for the periods in which we did not make a declaration. However, we would like you to provide information on whether we can obtain the input VAT of our supplies without VAT. Thank you.

Hi,

You are only able to recover VAT as input tax if you are VAT registered and you are only able to recover input tax prior to your date of VAT registration if you have purchased goods in the last 4 years and you were still in possession of those goods at the date of your VAT registration.

If you are able to successfuly backdate your VAT registration then you can treat the VAT incurred from that point if you meet the conditions of input tax as below:

VAT guide (VAT Notice 700)

Thank you.