I run a small LTD company and am VAT registered. I recently did some work for someone and sent over my invoice in due course, with 20% VAT added to the amount I quoted for the job (as per normal for me). The customer has just sent me a message saying the VAT is a problem and implying they are not happy to pay the amount requested as they didn't know that they would be charged in this way. In nearly 10 years of being VAT registered and quoting for jobs/issuing invoices I have never had a problem like this but they seem to think I am trying to charge them more than they originally agreed. As they are not VAT registered are they able to claim back VAT paid to me for my services or will it effectively come out of their pocket in a way that is different to if they were registered themselves? I'd like to resolve the situation amicably as they are a friend of friend and there was the possibility of more work from them in the future, but if I take the hit and charge them the amount minus VAT I'll be considerably out of pocket for a job that I was already doing for less than I would usually charge and quite frankly am totally skint right now so not particularly keen to do so. Just wondering if anyone has any useful advice of how best to resolve the situation or if there is anything that I can say to them about the accounting side of things that might help...?