Check the reverse charge conditions
A final invoice does not get a separate reverse charge rule. Check the supply and customer in the same way as any earlier construction invoice.
The reverse charge applies when your company and customer are UK VAT registered, the payment is reported under CIS, the service is standard or reduced rated, your company is not an employment business supplying staff, and the customer has not confirmed in writing that it is an end user or intermediary supplier.
Check the customer’s UK VAT number and CIS status before choosing the invoice treatment. Ask the customer whether it has reported under CIS if the online check does not show a contractor registration.
Put the right VAT treatment on the invoice
If the reverse charge applies, say so on the invoice and make clear that your customer accounts for the VAT. Show the VAT amount or rate, but leave that VAT out of the amount you charge the customer.
Check when the invoice and retention count for VAT
For a single-payment services contract, the basic tax point is when the work is performed. Issuing a VAT invoice or receiving payment earlier can bring the tax point forward; an invoice issued shortly afterwards can also affect it.
For a contract with stage or interim payments, the tax point is generally when you receive payment or issue a VAT invoice, whichever happens first.
For a retention, the tax point is delayed until you receive that retention payment or issue a VAT invoice for it, whichever happens first. Check any unpaid retention separately from the main invoice.
If retention is still owed, read how to deal with retention payments before closing the company.
Finish your VAT Return and cancel registration
If your company stops being eligible for VAT registration, cancel it within 30 days. Stopping trading or making taxable supplies is one reason you may need to cancel.
Unless you transfer the VAT registration number with a business sold as a going concern, submit a final VAT Return. Account for outstanding VAT, including any VAT due on stock and assets, by the return’s due date.
After cancellation, do not issue an invoice showing your old VAT registration number. HMRC also says not to charge VAT or issue a VAT invoice for supplies made after cancellation.
If you need to invoice after cancellation for work supplied before it, ask HMRC or your accountant how the tax point and cancellation date affect that invoice.
If your company also paid subcontractors, read how to end its CIS contractor reporting.